Products Liability: A Legal Overview

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Products Liability: A Legal Overview

Summary

Products liability generally refers to the civil liability of a manufacturer or seller for injury caused

by its product to the person or property of a buyer or third party. Legal developments starting in

the 1960s, particularly the adoption of strict tort liability, have made it substantially easier for

persons injured by defective products to recover for damages. Starting in the 1980s, however,

many states enacted tort reform legislation that effectively places limits on an injured party’s

ability to recover. Advocates for consumers and plaintiffs view strong products liability law as

necessary to ensure adequate compensation for injured workers and consumers and to furnish an

incentive for the manufacture of safe products. Manufacturers and their insurers, by contrast,

contend that many products liability judgments are unwarranted or excessive and that national

uniformity in products liability law is needed. They have favored replacing the 50-state products

liability laws with one federal law. While bills that are narrowly focused on a particular product

or industry have been occasionally considered by Congress, no major products liability bills have

been introduced during the 113th Congress. This report will be updated as circumstances warrant.

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Products Liability: A Legal Overview

Contents

Overview of Products Liability........................................................................................................ 1

Manufacturing Defects .............................................................................................................. 1

Design Defects........................................................................................................................... 2

Warning Defects ........................................................................................................................ 4

Causes of Action ........................................................................................................................ 5

Strict Liability ..................................................................................................................... 6

Negligence........................................................................................................................... 7

Breach of Warranty ............................................................................................................. 8

Tortious Misrepresentation ................................................................................................ 10

Federal Government Action in Products Liability Law ................................................................. 11

Preemption of Tort Claims....................................................................................................... 13

Federal Statutes Enacted.......................................................................................................... 14

Appendixes

Appendix. Glossary of Terms ........................................................................................................ 17

Contacts

Author Contact Information........................................................................................................... 19

Acknowledgments ......................................................................................................................... 19

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Products Liability: A Legal Overview

Overview of Products Liability

Products liability, which is primarily governed by state law, concerns the civil liability of a

manufacturer, seller, or other party along a product’s manufacturing or distribution chain for

personal or property damages caused by a product to a consumer or third-party user of that

product.1 In a typical products liability lawsuit, a plaintiff brings a claim for damages against a

manufacturer for injuries sustained while using the product.2 Damages that a plaintiff typically

seeks are for the recovery of medical expenses, disability, pain and suffering, lost earnings and

earning capacity, property damage, emotional harm, and even punitive damages, which are

intended to punish a defendant’s particularly outrageous conduct.3 To obtain relief from the

courts, the plaintiff bears the burden of proving that she used the product in a reasonable or

foreseeable manner, and that the product either contained an unnecessary or unreasonable hazard

or was improperly marketed, resulting in the harm.4 Over time, product defects have been

generally grouped into three categories—manufacturing defects, design defects, and warning

defects, which are described in more detail below.5 Various causes of action may be relied upon

by a plaintiff who seeks to recover against a manufacturer, seller, or other third-party defendant.6

The causes of action reviewed in this report include strict liability, negligence, breach of warranty,

and tortious misrepresentation.7

Manufacturing Defects

A manufacturing defect is a mistake that occurs in the manufacturing process such that the

product fails to meet the manufacturer’s design specifications, resulting in an error that causes an

injury to a consumer or other third party.8 As demonstrated by the case below, products that are

physically flawed, damaged, or incorrectly assembled are common examples of manufacturing

Restatement (Third) of Torts: Products Liability §1 (1998) (“One engaged in the business of selling or otherwise

distributing products who sells or distributes a defective product is subject to liability for harm to persons or property

caused by the defect.”).

See David G. Owen, Products Liability Law 3 (2d ed. 2008). Courts may define “product” in a number of ways, but

the Restatement (Third) of Torts: Products Liability Section 19 provides that “A product is tangible personal property

distributed commercially for use or consumption. Other items, such as real property and electricity, are products when

the context of their distribution and use is sufficiently analogous to the distribution and use of tangible personal

property.” Section 19 excludes from the definition of “product,” “services, even when provided commercially,” and

“human blood and human tissue.”

See generally Paul Sherman, Products Liability for the General Practitioner 282- 96 (1981) (describing in detail

available damages and remedies under various products liability causes of action).

See Owen, supra note 2, at 3.

See Restatement (Third) of Torts: Products Liability §2 (1998) (“A product is defective when, at the time of sale or

distribution, it contains a manufacturing defect, is defective in design, or is defective because of inadequate instructions

or warning.”). See also Owen, supra note 2, at 36-37. Notably there are special rules applicable for product

components, like raw materials, valves or switches that have no capabilities until integrated into other products, as well

as prescription drugs and medical devices. See Restatement (Third) of Torts: Products Liability §§5-6.

See, e.g., Wright v. Brooke Group Ltd., 652 N.W.2d 159, 181 (Iowa 2002) (“[W]hile strict liability, negligence, and

breach of warranty are ‘distinct theories of recovery, the same facts often give rise to all three claims.’”).

See Owen, supra note 2, at 29-34.

See Restatement (Third) of Torts: Products Liability §2(a) (defining a manufacturing defect as a situation in which a

“product departs from its intended design even though all possible care was exercised in the preparation and marketing

of the product”).

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defects.9 There are two key characteristics to a manufacturing defect claim that tend to benefit a

plaintiff’s case.10 First, as this type of lawsuit only contests the correct manufacturing of a single

unit out of the entire product line, it is commonly less costly to litigate than a design or warning

defect claim, where an entire product line may need to be challenged. Second, as most

jurisdictions closely adhere to a “strict liability” standard when evaluating a manufacturing defect

case, it may be easier for a plaintiff to prevail on her claim because she may likely face a lower

burden of proof.11 The “strict liability” standard is discussed in more detail below (see “Strict

Liability”). Because consumers generally expect that the products they purchase will be free of

dangerous defects, a manufacturer may be more amenable to settling a case if it is persuaded that

a physical flaw in its product injured a claimant.12 On the other hand, a manufacturer may be

more apt to litigate if it believes that the product was not defective; if the plaintiff’s harm was

caused by something else; or, even if the product did cause the harm, something other than the

manufacturer caused the product’s defectiveness after it left the manufacturer’s control; or the

plaintiff’s damage claim is unreasonable.13

Colon ex rel. Molina v. BIC USA, Inc., provides an example of a plaintiff, acting on behalf of

herself and her injured child, who proceeded against the defendant on a manufacturing defect

claim, after her child suffered severe burns on his body from playing with a disposable lighter

that was manufactured with a “child guard” safety latch.14 The lighter at issue no longer had the

child-resistant safety latch when the police retrieved it. In pursuing her manufacturing defect

claim, the court stated that under the applicable state law, a plaintiff must “show that a specific

product unit was defective as a result of ‘some mishap in the manufacturing process itself,

improper workmanship, or because defective materials were used in construction,’ and that the

defect was the cause of the plaintiff’s injury.”15 The court did not dismiss the plaintiff’s

manufacturing defect claim, finding there was sufficient evidence from which a jury might

“reasonably conclude that the subject lighter was a lemon and the safety latch just fell out or was

otherwise removable with the slightest tug.”16

Design Defects

A design defect is a mistake in a product’s design that results in undue risk to a consumer or other

third party that could have been reasonably prevented by a safety device or other design

alternatives.17 Design defect claims are the most commonly asserted type of products liability

Id. at §2, cmt. c.

See Owen, supra note 2, at 448-49.

Id. at 448-49. In addition, manufacturing defect claims may be immune from certain types of requirements,

limitations, or defenses applicable to the other categories of product defect claims.

Id. at 449.

Id. at 449-50.

Colon ex rel. Molina v. BIC USA, Inc., 199 F. Supp. 2d 53 (S.D.N.Y. 2001) (applying New York law). The plaintiff

also asserted design defect, failure-to-warn, and breach of warranty claims in her suit.

Id. at 85. (“In other words, a manufacturing flaw exists when the unit in question deviates in quality and other

performance standards from all of the other identical units.” Id.).

Id. at 94-95.

See Restatement (Third) of Torts: Products Liability §2(b) (defining a design defect as occurring “when the

foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of a reasonable

alternative design by the [manufacturer] and the omission of the alternative design renders the product not reasonably

safe”).

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claim against a manufacturer.18 For example, much of automotive products liability litigation

challenges the design of motor vehicles.19 Unlike a manufacturing defect claim, which examines

an individual product, a design defect claim may be more problematic for a manufacturer because

it examines the safety of an entire product line, which may need to be modified or removed from

the market should the court make a declaration against the manufacturer.20 As even the bestdesigned product can be dangerous if used incorrectly, an ongoing challenge for courts has been

how to best determine what constitutes a design defect.21 Courts generally evaluate the adequacy

of a product’s design upon one of two standards, or a combination thereof.22 The first is a

“consumer expectations” test, which asks whether the design meets the safety expectations of

users or consumers.23 The second is a “risk-utility” test, which asks whether the safety benefits of

designing away foreseeable danger exceed the resulting costs.24 Today, most jurisdictions have

moved away from the consumer expectations test and, instead, employ some form of the riskutility or cost-benefit standard.25 The Restatement (Third) of Torts: Products Liability reflects this

shift, as it has primarily adopted a cost-benefit liability standard for design defectiveness.26

Young v. Pollock Engineering Group Inc., serves as an example of a design defect case.27 In

Young, the plaintiff worked as a “die man,” whereby he loaded die into a die changer. The

plaintiff’s coworker accidentally activated the die changer while the plaintiff was loading the die,

from which he sustained severe injuries to his left hand. The plaintiff sued the manufacturer of the

die changer for design defectiveness, as the plaintiff’s employer was able to install a “barrier

guard” around the die changer subsequent to the accident.28 The court stated that under the

applicable state law, a plaintiff asserting a design defect claim must establish that the product

See Owen, supra note 2, at 497. The absence of an adequate safety device is frequently the claim of design

defectiveness. See, e.g., Thibault v. Sears, Roebuck & Co., 395 A.2d 843 (N.H. 1978) (lack of sufficient housing

surrounding a power lawnmower); Burke v. Spartanics, Ltd., 252 F.3d 131 (2d Cir. 2001) (lack of mechanical guard or

electrical interlock cut-off device on a dangerous machine); Halliday v. Sturm, Ruger & Co., 792 A.2d 1145 (Md.

2002) (lack of a “safety” on a gun).

See Owen, supra note 2, at 497.

Id. at 499.

Id. at 36-37.

Id. at 502.

In the 1960s and 1970s, most courts which applied the rule of Section 402A of the Restatement (Second) of Torts in

products liability cases concluded that design defectiveness should be measured by “consumer expectation,” given that

the definitions of the product liability standard contemplate the consumer’s expectations. Owen, supra note 2, 502-03,

508. See also Restatement (Second) of Torts §402A, cmt. g (defining “defective condition” as “where the product is, at

the time it leaves the seller’s hands, in a condition not contemplated by the ultimate consumer, which will be

unreasonably dangerous to him”); and §402A, cmt. i (defining “unreasonably dangerous” as “the article sold must be

dangerous to an extent beyond that which would be contemplated by the ordinary consumer who purchases it, with the

ordinary knowledge common to the community as to its characteristics.”).

Owen, supra note 2, at 502.

Generally, a “risk-utility” test indicates that a “product’s design may be classified as defective if the costs of

improving its safety (including dollar costs and any lost utility or increased dangers of other types) are less than the

expected safety benefits.” Id. at 37.

Id. at 509. See also Restatement (Third) of Torts: Products Liability §2(b) (“A product is defective in design when

the foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of a reasonable

alternative design ..., and the omission of the alternative design renders the product not reasonably safe.”). Comment d

provides that this subsection “adopts a reasonableness (‘risk-utility balancing’) test as the standard for judging the

defectiveness of product designs.”

Young v. Pollock Engineering Group, Inc., 428 F.3d 786 (8th Cir. 2005) (applying Minnesota law). The plaintiff also

brought a failure-to-warn claim against the manufacturer of the die changer.

Id. at 788.

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“was in a defective condition unreasonably dangerous for its intended use.”29 For a court to

determine whether there is enough evidence to submit the claim to a jury, the court is required to

“balance the likelihood of harm, and the gravity of harm if it happens, against the burden of the

precaution which would be effective to avoid the harm.”30 On appeal, the court reversed the lower

court’s dismissal of the plaintiff’s design defect claim, finding that the plaintiff had presented

sufficient evidence of a defective design of the product at issue.31

Warning Defects

A warning defect is one where a manufacturer fails to provide appropriate information about a

product’s known hazards and how to avoid them, resulting in undue risks to a consumer that

could have been reasonably prevented.32 A manufacturer’s general “duty to warn” can be viewed

as encompassing two distinct obligations. One is the “duty to warn,” where a manufacturer must

inform buyers and users of hidden dangers in a product; the second obligation is the “duty to

instruct,” where a manufacturer must inform buyers on how to avoid a product’s dangers in order

to use it safely.33 Warnings are generally regarded by manufacturers as a relatively inexpensive

means through which to improve product safety; this view is perhaps reinforced by plaintiffs,

who often raise warning defect claims, viewing them as both less expensive and easier to prove in

court than a design defect.34 However, despite the apparent cost benefits that warning defect

claims bring to both manufacturers and plaintiffs, courts do not readily require that manufacturers

warn of all product dangers.35 Rather, a central issue posed by a warning defect claim is

“adequacy.” Although courts will generally not require a manufacturer to warn about obvious

defects that would be apparent to ordinary consumers,36 whether a warning is adequate may

depend on a variety of factors. These may include “the severity of the danger; the likelihood that

the warning will catch the attention of those who will foreseeably use the product and convey the

nature of the danger to them; the intensity and form of the warning; and the cost of improving the

strength or mode of the warning.”37

In Carruth v. Pittway Corporation, for example, the plaintiffs, who were estate administrators for

the decedents, brought a warning defect claim against the manufacturer of a smoke detector.38 In

Carruth, the plaintiffs had installed a smoke detector in their home two days prior to a fire that

Id.

Id. at 789. The court further stated that whether there is feasible, safer design alternative is an important factor in this

balancing test, and that “[o]nly in rare cases do defective-design claims succeed without showing a safer design.” Id.

Id. at 791.

See Restatement (Third) of Torts: Products Liability §2(c) (defining a warning defect as a situation in which “the

foreseeable risks of harm posed by the product could have been reduced or avoided by the provision of reasonable

instructions or warnings by the [manufacturer] and the omission of the instructions or warnings renders the product not

reasonably safe”).

See Owen, supra note 2, at 584.

Id.

Id. at 584 n. 33 (quoting Killeen v. Harmon Grain Prods., Inc., 413 N.E.2d 767, 770-71 (Mass. App. Ct. 1980)

(stating that a duty to warn is not imposed as “a mindless ritual”)).

Id. at 654-55. This standard aims to prevent consumers from being oversaturated with warnings that lead many of

them to simply disregard the manufacturer’s safety information. See id at 584-86, 656.

Bloxom v. Bloxom, 512So.2d 839, 844 (La. 1987). See also Restatement (Third) of Torts: Products Liability §2(c),

cmt. i.

Carruth v. Pittway Corp, 643 So. 2d 1340 (Ala. 1994).

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led to the decedents’ death.39 The plaintiffs alleged that the literature accompanying the smoke

detector did not properly warn users about the dangers of installing the smoke detector in “dead

air space,” an area near the top of the wall and corners of a room where smoke will not easily

circulate.40 As a result, the smoke detector was improperly installed and did not properly function

during the fire. In addressing the failure-to-warn claim, the court stated that “the law does not

require that necessary warnings be conveyed in the best way possible, ... but does require that

they not be conveyed in a manner that effectively ‘prevents a consumer from reading them and

being warned.’”41 In this instance, the court noted that while the manufacturer’s pamphlet

referenced the dangers of “dead air space,” it did so within a seven-page pamphlet with small and

tight print, which included a significant number of warnings but gave little emphasis to specific

dangers.42 The court concluded that the plaintiffs had presented enough substantial evidence from

which a jury could find that the warning was inappropriately given, as it was not adequately

designed to attract the user’s attention.43

Causes of Action

A plaintiff may assert a number of causes of action in her products liability lawsuit to support her

product defect claim, regardless of whether she is asserting a manufacturing, design, or warning

defect claim.44 Each of these causes of action has a unique set of factors that a plaintiff must

prove in order to obtain relief, as well as defenses that may protect a manufacturer from

liability.45 When bringing a products liability lawsuit, a plaintiff must take these factors and

defenses into consideration in determining the appropriate claim(s) to assert and the likelihood of

success. Although products liability law derives from common law judicial decisions, many states

have enacted legislation that codifies causes of action based on different theories of liability

and/or that places limits on when or against whom claims are to be asserted.46 The following

section provides a broad overview of the four types of tort claims that a plaintiff may typically

assert in her products liability lawsuit.

Id. at 1341-42.

Id.

Id. at 1345 (citation omitted).

Id. at 1345-46.

Id.

Restatement (Third) of Torts: Products Liability §2, cmt. n.

The significant number of defenses to product liability suits is beyond the scope of this report. In short, however,

such defenses can be grouped into three categories: user-misconduct defenses, no-duty defenses and special defenses.

David G. Owen, Special Defenses in Modern Products Liability, 70 Mo. L. Rev. 1, 1 (2005). User-misconduct

defenses—which include doctrines such as contributory negligence, comparative fault, assumption of risk, and

unreasonable reliance—remove liability from the manufacturer by alleging that the user improperly used the product.

Id. No-duty defenses—which can include the obvious risk and sophisticated user doctrines—are defenses that hold that

the features of the product or circumstances were such that the manufacturer had no duty to protect the user from the

complained danger. Id. Special defenses include all other types of defenses and typically apply to specific products,

industries, or circumstances. Id. at 1-2.

See, e.g., Tenn. Code Ann. §§29-28-101 to 29-28-108 (2012).

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Strict Liability

Contemporary products liability litigation is most often associated with the theory of strict

liability.47 Under the doctrine of strict liability, anyone who sells or manufactures an unreasonably

dangerous product that causes physical injury or property damage to the consumer will be found

liable for those damages, even if the seller or manufacturer took all possible steps to ensure the

safety of that product.48 An action for strict liability does not require the plaintiff to prove

negligence or wrongdoing by the seller or manufacturer; instead, the plaintiff simply needs to

prove that she purchased the product from the manufacturer or seller and was later injured by the

product.49 As a result, the strict liability standard makes it substantially easier for a plaintiff

injured by a defective product to recover damages when compared to other causes of action

described below. Advocates of applying a strict liability standard in products liability actions have

long argued that this standard ensures adequate compensation for injured consumers, deters

manufacturers from producing dangerous or low-quality products, and ensures judicial efficiency

by avoiding lengthy litigation.50

Following the publication of the treatise Restatement (Second) of Torts in 1965, most courts

promptly adopted the strict liability standard set forth in Section 402A for nearly all products

liability lawsuits in the 1960s and 1970s.51 However, standards have since shifted, and many

courts now apply a strict liability standard to manufacturing defect claims while evaluating design

and warning defect claims under a negligence standard.52 Although the subsequent publication of

the Restatement (Third) of Torts: Products Liability reflects this approach taken by the courts,53

many courts continue to cite Section 402A jurisprudence for the proposition that they are

applying a “strict” liability standard to product defect claims.54 It has been observed that “courts

have created a disjunction between what they say and what they do,” and it appears that “courts

for many years will continue to apply principles of negligence to design and warning defect

claims while purporting to apply the ‘strict’ liability doctrine spawned by § 402A.”55

See Owen, supra note 2, at 254.

Id. at 266-68. See also Restatement (Second) of Torts §402A, which states,

One who sells any product in a defective condition unreasonably dangerous to the user or consumer

or to his property is subject to liability for physical harm thereby caused to the ultimate user or

consumer, or to his property, if:

(a) the seller is engaged in the business of selling such a product, and

(b) it is expected to and does reach the user or consumer without substantial change in the condition

in which it is sold.

This rule applies although (i) the seller has exercised all possible care in the preparation and sale of his product, and (ii)

the user or consumer has not bought the product from or entered into any contractual relation with the seller.

See Owen, supra note 2, at 66.

Id. at 288-97.

Id. at 33.

Id. During the 1970s and 1980s, even though courts broadly extended the new principle of strict liability from

Section 402A “beyond manufacturing flaws to design and warning cases, the truly strict consumer expectations test

increasingly gave way to the principles of foreseeability and risk-utility balancing that underlie the law of negligence.”

Id.

Id. at 33-34.

Id. at 34.

Id.

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Greenman v. Yuba Power Products, Inc., was a landmark case from 1963 where the court

“constructed a new doctrine of strict products liability.”56 It is thus illustrative of how a court may

evaluate a product defects case under a strict liability standard. In Greenman, the plaintiff

sustained serious injuries to his forehead when a piece of wood unexpectedly flew out while he

was using a power tool as a wood lathe, a use for which the tool had been designed and

marketed.57 Despite the lower court’s finding that the manufacturer had not acted negligently or

maliciously and that the plaintiff had not given the manufacturer proper notice of the damages he

suffered from the power tools—which were necessary elements for liability under the existing

state law—the Supreme Court of California held that the manufacturer was liable for the

plaintiff’s injuries.58 The court declared, “A manufacturer is strictly liable in tort when an article

he places on the market, knowing that it is to be used without inspection for defects, proves to

have a defect that causes injury to a human being.”59 It reasoned that the costs of injuries resulting

from defective products should be borne by the manufacturer, regardless of fault, instead of the

injured party, who had no means through which to protect himself.60 According the court, a

manufacturer is always liable whenever a plaintiff, while using the product in its intended way, is

injured due to a manufacturing defect for which the plaintiff did not receive adequate warning.61

Negligence

A classic cause of action under tort law, negligence is defined as a harm to another resulting from

a “failure to exercise the standard of care that a reasonably prudent person would have exercised

in a similar situation.”62 While the increased application of a strict liability standard in the 1960s

and 1970s displaced the role of negligence as the principal cause of action in products liability

litigation, negligence remained as an alternative means through which a plaintiff could recover

damages, and it has regained importance since the 1980s.63 There are four factors that a plaintiff

generally needs to prove in a negligence action: (1) the defendant had a legal duty to act; (2) the

defendant breached that duty; (3) the breach was both a cause-in-fact and proximate cause to the

plaintiff’s injuries; and (4) the plaintiff suffered damages which can be recovered in court.64 In

applying these factors to a products liability lawsuit for negligence, a plaintiff generally must

prove that (1) the manufacturer produced an unreasonably dangerous product; (2) the unsafe

product caused injury to the plaintiff; and (3) the plaintiff suffered damages which can be

recovered in court.65 Because a plaintiff bears the burden of presenting evidence to show that the

Greenman v. Yuba Power Prods. Inc., 377 P.2d 897 (Ca. 1963). The plaintiff also asserted claims for breach of

express and implied warranty.

Id. at 898.

Id. at 899-902.

Id. at 900 (recognizing that this doctrine had been first applied to unwholesome food products but has since been

extended to a variety of other products. Id.).

Id. at 901 (“The purpose of [imposing strict liability on the manufacturer] is to insure that the costs of injuries

resulting from defective products are borne by the manufacturers that put such products on the market rather than by

the injured persons who are powerless to protect themselves.” Id.).

Id. at 901-02.

Black’s Law Dictionary 1133 (9th ed. 2009). See also Owen, supra note 2, at 60-61; Sherman, supra note 3, at 1-3.

Sherman, supra note 3, at 1-3.

Prosser, Handbook of Law of Torts, 143 (4th ed. 1971).

See Owen, supra note 2, at 61.

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manufacturer failed to use reasonable care in designing and/or manufacturing the product, the

negligence standard may be seen as more favorable to manufacturers than strict liability.66

Courts generally determine whether a manufacturer has acted negligently by balancing the cost to

the manufacturer of taking additional safety precautions against the benefits provided by those

precautions.67 If the product creates high risks, a manufacturer would likely be required to take

greater care in mitigating those risks; whereas if a product creates only small risks, a

manufacturer would likely be required to only take minor precautions.68 Importantly, negligence

claims do not require that a manufacturer create a product that is perfectly safe, but only a product

that is reasonably safe for its intended purpose.69

In Ford Motor Co. v. Bartholomew,70 for example, the plaintiff commenced a negligence suit

against the manufacturer of her car after she was severely injured when her car rolled backwards

due to a design defect in the car’s transmission system.71 At trial, the plaintiff brought in an expert

witness who testified that the plaintiff’s car model was manufactured with a defect in the

transmission system which, when certain events occurred, would appear to be in the “Park”

position, but had not fully engaged.72 The plaintiff also introduced evidence to demonstrate that

the car manufacturer was aware of the defect and had modified it in subsequent models.73 The

jury found in favor of the plaintiff, finding that the transmission system was not safe for its

intended use because a reasonably prudent driver would have been led into a “false sense of

security” by believing the transmission to be fully engaged in the “Park” position.74

Breach of Warranty

A products liability lawsuit where a breach of warranty action is asserted by a plaintiff closely

resembles an action for breach of contract.75 In essence, a products manufacturer has obligations

under the law when it makes assertions about a product. If a consumer reasonably relies upon

these assertions, the assertions become part of what the consumer bargained for when she

purchased the product. As a result, a consumer may bring an action for breach of warranty against

the manufacturer if the assertion is proven untrue. Breach of warranty lawsuits are governed by

the Uniform Commercial Code (“UCC”), a model statute that was adopted by most state

legislatures in the 1950s.76 The UCC recognizes two principal types of warranties—express and

implied.77 An express warranty is an assertion made directly by the manufacturer or seller about

Id. at 65-6.

Id. at 30.

Id.

Id. at 62-63.

Ford Motor Co. v Bartholomew, 297 S.E.2d 675 (Va. 1982). The plaintiff also asserted theories of strict liability,

failure-to-warn of a design defect, and breach of implied warranty.

Id. at 677-78.

Id. at 678.

Id. at 678-80.

Id. at 680. This holding was upheld on appeal. Id. at 684.

See Owen, supra note 2, at 148-49.

Id. at 49-50.

See U.C.C. §§2-313, 2-314, 2-315 (2012); see also Owen, supra note 2, at 148.

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the performance, quality, or characteristics of a product.78 In contrast, an implied warranty is a

promise or representation, even if the statement is not directly asserted, about a product’s minimal

standard of quality that the law attributes to anyone selling a product.79 Similar to a strict liability

action, a plaintiff need not show negligence or wrongdoing by the manufacturer or seller in an

action for breach of warranty—whether express or implied.80 While the specific elements needed

to impose liability will vary depending on the type of warranty given, a manufacturer or seller

could be held liable so long as the plaintiff demonstrates that a warranty was made, relied upon,

and breached.81

The plaintiff in Forbes v. General Motors Corp.82 brought a products liability suit claiming

breach of an express warranty after being severely injured when her car’s air bag failed to deploy

during a strong front-end accident.83 The plaintiff argued that (1) the product breached an express

warranty or failed to conform to other express factual representations upon which she relied; (2)

the “defective condition” rendered the air bag and car unreasonably dangerous to the plaintiff;

and (3) the dangerous condition caused the plaintiff’s injuries. At trial, the plaintiff introduced

evidence that the car owner’s manual stated that the air bag would deploy in an accident and that

she paid a higher price for a model equipped with an air bag after a salesman emphasized the

importance of this feature during the sales process.84 Under the state law for breach of express

warranty, the plaintiff was not required to present evidence of product defectiveness.85 Rather, the

plaintiff need only demonstrate that the product did not live up to its warranty, that is, that, upon

impact, the car’s air bag did not deploy.86 On appeal, the court found that the plaintiff presented

sufficient evidence from which a jury could conclude that the car manufacturer was liable for

breach of an express warranty.87

See Sherman, supra note 3, at 44-9.

See Black’s Law Dictionary 1725 (9th ed. 2009) (defining implied warranty as “[a]n obligation imposed by the law

when there has been no representation or promise” or as a “warranty arising by operation of law ... rather than by the

seller’s express promise”).

The UCC codifies two implied warranties: the implied warranty of merchantability and the implied warranty of fitness

for a particular purpose. See U.C.C. §§2-314, 2-315. The implied warranty of merchantability “requires that goods

conform to certain minimum standards ... that of being fit for the ordinary purpose for which such goods are used.”

Sherman, supra note 3, at 54. The implied warranty of fitness for a particular purpose “is an implied promise by the

seller that the product sold will meet the buyer’s particular needs” that is imposed in those situations when the seller is

aware of the particular needs for which the product is required. See Owen, supra note 2, at 181 (emphasis in original).

Owen, supra note 2, 154 n.8, 171, 188 (stating that liability for breach of an express warranty is “truly strict[,]” that

liability for breach of the implied warranty of merchantability is a “form of ‘strict’ liability[,]” and that liability for

breach of the implied warranty of fitness for a particular purpose can be found “even if the product is entirely

merchantable and ‘nondefective[,]’” respectively).

Id. at 152-53, 172-74, 182. See also U.C.C. §§2-313, 2-314, 2-315.

Forbes v. General Motors Corp., 935 So.2d 869 (Miss. 2006).

Id. at 871-72.

Id. at 874-75.

Id. at 879. The Mississippi provision under which the plaintiff sued “does not require that the product be defective,

but simply requires a failure of the product to perform as warranted.” Id.

Id. at 877-78 (“We do not intend for today’s holding to become a strict rule that no expert testimony is ever needed in

any products liability case involving an automobile’s air bag. The nature of these fact-driven actions is such that we

must approach them on a case-by-case basis.”).

Id. at 881-82. The Supreme Court of Mississippi allowed the plaintiff’s claim to be heard on remand because it

reversed the decision of the lower court, which had granted a motion in favor of the defendant car manufacturer.

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In contrast, the plaintiff in Morrison v. Sears, Roebuck & Co.88 asserted a products liability claim

for breach of an implied warranty. The plaintiff brought suit against the seller and manufacturer

of a pair of high heels that collapsed the second time the plaintiff wore them. She suffered a

serious injury that required surgery to correct.89 Under the state’s law, a plaintiff is required to

prove that (1) the goods bought and sold were subject to an implied warranty of merchantability;

(2) the goods did not comply with the warranty in that the goods were defective at the time of

sale; (3) the plaintiff’s injury was due to the defective nature of the goods; and (4) damages were

suffered as a result.90 During trial, the plaintiff introduced evidence that the heels of the shoe were

made of plastic without any interior support and could easily give way when excessive pressure

was applied.91 On appeal, the court concluded that this evidence could lead a reasonable jury to

conclude that the seller and manufacturer had breached an implied warranty, as the shoes did not

appear to be suitable for the purpose for which they were designed and were defective at the time

sold.92

Tortious Misrepresentation

Tortious misrepresentation is another cause of action by which a plaintiff can recover when

harmed by reasonably relying on a manufacturer’s representation about a product that is later

shown to be false.93 Tortious misrepresentation cases usually fall within one of two categories: (1)

intentional or fraudulent misrepresentation—that is, cases where the manufacturer knows that the

assertion is false—or (2) negligent misrepresentation—that is, cases where the manufacturer

should have known that the statement was false.94 A plaintiff bears the burden of proving the

various elements of her fraudulent or negligent misrepresentation claim.95 Misrepresentation

claims generally do not require a plaintiff to show that the product was defective at the time of

sale.96 However, due to the somewhat subjective nature of these elements, such as demonstrating

that the manufacturer was aware of the falsity of his statement and that the plaintiff’s reliance on

the statement was reasonable, it may be difficult for a plaintiff to succeed in her case.97

Furthermore, a plaintiff often faces a heightened standard for her pleading requirement to the

court, and must satisfy a “clear and convincing evidence” standard when bringing a fraudulent

misrepresentation claim.98 As a result, it appears that a plaintiff rarely attempts to recover

Morrison v. Sears, Roebuck & Co., 354 S.E.2d 495 (N.C. 1987). The plaintiff also asserted a claim of failure-towarn.

Id. at 496.

Id. at 301 (referencing N.C. Gen. Stat. §25-2-314).

Id. at 497-98.

Id. at 497-98, 305. The Supreme Court of North Carolina reversed the decision of the lower court to grant summary

judgment in favor of the defendants—the retail store and shoe manufacturer.

See Owen, supra note 2, at 31. See also Restatement (Third) of Torts: Products Liability §9. A number of

jurisdictions have also recognized liability for innocent misrepresentation as stated in Restatement (Second) of Torts

§402B.

Id. at 113. These elements, sometimes condensed the courts, generally include (1) a representation; (2) its falsity; (3)

its materiality; (4) the speaker’s knowledge of its falsity or ignorance of its truth; (5) his intent that it should be acted on

by the person and in the manner reasonably contemplated; (6) the hearer’s ignorance of its falsity; (7) his reliance on its

truth; (8) his right to rely thereon; and (9) his consequent and proximate injury. Id. at 114.

Id. at 115, 133.

Restatement (Third) of Torts: Products Liability §9, cmt d.

See Owen, supra note 2, at 114-138 (detailing the judicial requirements plaintiffs must meet to prove claims for

tortious misrepresentation).

Id. at 116-17.

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damages under tortious misrepresentation, especially if the products liability claim can be

pursued through another cause of action.99

An example of a products liability case brought under a tortious misrepresentation cause of action

is First National Bank v. Brooks Farms.100 The plaintiffs in Brooks Farm were a group of dairy

farmers who had purchased a silo that failed to adequately preserve cattle feed, leading to a

number of economic losses because milk production from the cattle decreased. At trial, the

plaintiffs introduced evidence of the manufacturer’s promotional material, which indicated that

the silos would prevent oxygen from contacting the feed and preserve the feed’s nutritional value.

The plaintiffs also demonstrated that the manufacturer had knowledge that these representations

were false by submitting the manufacturer’s internal memoranda as well as testimony from the

manufacturer’s engineers, which confirmed its knowledge.101 On appeal, the court affirmed the

jury’s finding that the manufacturer intentionally misrepresented information about the product

upon which the plaintiffs relied and subsequently suffered damages.102

Federal Government Action

in Products Liability Law

Federal involvement in the products liability area can be traced back to the Interagency Task

Force on Product Liability (Task Force) begun by the Ford Administration in 1976.103 The Task

Force’s final report in 1977 found a dramatic increase in costs of products liability and sparked

various working groups that examined the issue of products liability and tort reform throughout

the 1970s and 1980s.104

Id. at 116-17, 132. Fraudulent misrepresentation claims have figured prominently in litigation against cigarette

manufacturers. See generally Motley and Player, Issues in “Crime Fraud” Practice and Procedure: The Tobacco

litigation Experience, 49 S.C. L. Rev. 187 (1998).

100

First Nat’l Bank v. Brooks Farms, 821 S.W.2d 925 (Tenn. 1991).

101

Id. at 927-27.

102

Id. at 926-27, 931.

103

Victor E. Schwartz & Mark A Behrens, The Road to Federal Product Liability Reform, 55 Md. L. Rev. 1363, 1363

(1996).

104

Id.

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Products Liability: A Legal Overview

As products liability

Overview of Federal Government Action

has traditionally been

on Product Liability, 1970s-1980s

an area governed by

1977—Federal Interagency Task force on Product Liability, directed by the

state law (see

Department of Commerce, issued a final report finding a dramatic increase in costs

“Overview of State

of products liability insurance that made it difficult for small businesses to obtain

Action” Text Box

insurance.105

below), federal reform

1978—In April, the Department of Commerce released an Options Paper that

efforts have raised

included a model bill titled “Product Liability Self-Insurance Act of 1978.”106 In July,

questions on the

the Carter Administration unveiled its program to manage product liability concerns,

which closely followed the proposals suggested in the Department of Commerce’s

propriety of federal

Options Paper, and directed that a model uniform product liability law be prepared

legislation in the area.

to add stability to products liability law.

Current jurisprudence

1979—The Department of Commerce published a Model Uniform Product Liability

suggests that products

Act.107 While intended for enactment by the states, both the draft and final versions

liability legislation

of the act were introduced in the 96th Congress, but were not enacted.

would be permissible

1981—Congress enacted the Product Liability Risk Retention Act,108 which sought to

so long as it falls

lower insurance costs by permitting businesses to form self-insurance pools.109

within Congress’s

1985—The Tort Policy Working Group, consisting of representatives of 10 federal

power to regulate

interstate commerce.110 agencies and the White House, was established.

1986—The Tort Policy Working Group issued a report titled “Report of the Tort

Nonetheless, it may be

Policy Working Group on the Causes, Extent and Policy Implications of the Current

unconstitutional for

Crisis of Insurance Availability and Affordability.” The report made eight

Congress to enact

recommendations, including the elimination of joint and several liability and of the

products liability

collateral source rule, a $100,000 cap on noneconomic damages, and 25% cap on the

legislation that does

first $100,000 in a lawyer’s contingent fees.

not substantially affect

1987—The Tort Policy Working Group issued another report, “An Update on

interstate commerce.111 Liability Crisis.”

For a more in-depth

analysis of the

constitutionality of federal products liability and other tort-reform legislation, see CRS Report 95797, Federal Tort Reform Legislation: Constitutionality and Summaries of Selected Statutes, by

(name redacted).

105

See id. at 1365. The report also concluded that the rise in costs could be attributed to irrational premium setting

procedures by insurance companies and the uncertainty of products liability litigation. See id. at 1365-66.

106

See “Options Paper on Product Liability and Accident Compensation Issues,” 43 Fed. Reg. 14612, April 6, 1978.

The Department of Commerce also published a summary of more than 300 comments submitted to it on its Options

Paper in September 1978. See Dep’t of Commerce, 43 Fed. Reg. 40438, Sept. 11, 1978.

107

See 44 Fed. Reg. 2996, Jan. 12, 1979, for the draft version and 44 Fed. Reg. 62714, October 31, 1979, for the final

version.

108

Product Liability Retention Act of 1981, P.L. 97-45, codified at 15 U.S.C. §§3901-3906.

109

See Schwartz & Behrens, supra note 103, at 1365.

110

The United States’ Constitution grants Congress the power “To regulate Commerce with foreign nations, and among

the several States[.]” U.S. CONST. art. I, §8, cl. 3. See also Gonzalez v. Raich, 545 U.S. 1, 26 (2005) (holding that

Congress could regulate the manufacture and possession of marijuana as marijuana is a commodity with “an

established, lucrative and interstate market” and “[p]rohibiting the intrastate possession or manufacture of an article of

commerce is a rational (and commonly utilized) means of regulating commerce in that product”).

111

See United States v. Lopez, 514 U.S. 549, 561 (1995) (holding that Congress cannot regulate possession of a firearm

within a school zone through the Gun-Free School Zones Act of 1990 as such an act has “nothing to do with

‘commerce’ or any sort of economic enterprise [and] is not an essential part of a larger regulation of economic activity,

in which the regulatory scheme could be undercut unless the intrastate activity were regulated”).

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Products Liability: A Legal Overview

Federal tort reform bills have generally been limited in scope, many of which have been

principally aimed at protecting those who sell particular types of products or commit particular

types of negligence.112 This trend has been particularly apparent since 1996, when Congress did

not override President Clinton’s veto of broad products liability legislation (H.R. 956, 104th

Congress).

Consumer representatives and plaintiffs’ attorneys generally oppose measures that would

effectively limit an injured party’s ability to recover in products liability suits. They consider the

tort system necessary to provide incentives for the manufacture of safe products and to ensure

adequate compensation for injured workers and consumers. Conversely, insurance companies and

product manufacturers have supported federal products liability reform, hoping to reduce the

amounts paid due to products liability lawsuits, and seeking national uniformity in products

liability law.

Overview of State Action

In response to the liability insurance

“crisis,” which was characterized by a

sudden increase in liability premiums,

many states enacted tort reform during

the 1980s.113 Some states limited the

right of the plaintiff to sue product sellers

other than the manufacturer; some states

permitted awards of punitive damages

only upon proof by “clear and

convincing” evidence, or required that a

portion of punitive damages be paid to a

state fund; some states enacted caps on

punitive damages or on noneconomic

damages; some states limited or

eliminated joint and several liability or the

collateral source rule; and some enacted

a statute of repose. (See the Appendix

for an explanation of these terms.) State

reforms continued to be enacted through

the 1990s and to the present day.

A federal statute could bring about national uniformity with

respect to some products liability issues. For example, past

proposals would have included a federal statute of

limitations or a federal statute of repose for products

liability suits. The possibility of national uniformity,

however, should not be overestimated. For instance, other

past proposals, such as one that would establish a standard

of conduct for the award of punitive damages, could likely

be subject to varying interpretations by every federal and

state court absent a Supreme Court decision establishing a

national interpretation. Even if the Supreme Court issues

such an interpretation, such a provision’s application to the

facts of particular cases may vary among jurisdictions.

Preemption of Tort Claims

When Congress wants to create standards or regulate in the

area of products liability, it sometimes will enact laws that

bar liability for certain causes of action by having a federal

law “preempt” state law. Preemption doctrine has its constitutional basis in the Supremacy Clause

of the U.S. Constitution, which establishes that federal statutes enacted in accordance with the

Constitution “shall be the supreme Law of the Land.”114 The Supreme Court has long held that,

under the Supremacy Clause, a state law interfering with or running contrary to a federal law is

preempted by it and is thus invalid.115 The Court has further concluded that federal statutes can

112

For a list of federal tort reform statues, see CRS Report 95-797, Federal Tort Reform Legislation: Constitutionality

and Summaries of Selected Statutes, by (name redacted). For a list limited to pr

oducts liability statutes, see section below,

“Federal Statutes Enacted.”

113

See, e.g., Handbook of Insurance 243-301 (Georges Dionne ed., 2000).

114

U.S. Const. art. VI, cl. 2.

115

See Gibbons v. Ogden, 22 U.S. (9 Wheat.) 1, 212 (1824). A federal law may either expressly preempt state law by

explicitly stating so in the language of the federal statute, or preemption may be implied depending on the federal

statute’s structure or purpose. See Gade v. Nat'l Solid Waste Mgmt. Ass’n, 505 U.S. 88, 98 (1992) (“Pre-emption may

be either expressed or implied, and ‘is compelled whether Congress’ command is explicitly stated in the statute’s

language or implicitly contained in its structure and purpose.’”). The Supreme Court has recognized two types of

implied preemption: field preemption—which occurs when a state law attempts to regulate a field in which Congress

(continued...)

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Products Liability: A Legal Overview

impose requirements that potentially conflict with state common law, which includes much of

product liability law, thus warranting an analysis under the preemption doctrine.116

Examples of federal laws that have been found by the Supreme Court to preempt state law

include the Federal Cigarette Labeling and Advertising Act (FCLAA) and the Federal Food Drug

and Cosmetics Act (FFDCA). Under the FCLAA, Congress provided that “[n]o requirement or

prohibition based on smoking and health shall be imposed under State law with respect to the

advertising or promotion of any cigarettes the packages of which are labeled in conformity with

the provisions of [the] Act[.]”117 The Supreme Court held that the FCLAA preempted state

“failure to warn” and “fraudulent misrepresentation” claims that were based on cigarette

advertising or promotion when the product manufacturer complied with the required federal

regulations.118 Similarly, the FFDCA forbids states from establishing requirements for medical

devices that are “different from, or in addition to” those established by the act and “which relate

to the safety or effectiveness of the device or to any other matter included in a requirement

applicable to the device under [the] Act.”119 The Supreme Court held that the federal regulations

for catheters, enacted pursuant to the FFDCA, preempted a state law claim alleging that the

catheter was “designed, label[ed] and manufactured in a manner that violated ... New York

common law.”120

Federal Statutes Enacted

While Congress enacted a number of products liability laws in the 1980s and 1990s, there has

been little legislation in recent years. The following section provides a brief overview of federal

products liability statutes enacted from the 97th Congress through the present. For specific terms

related to tort, see the Appendix.

During President Reagan’s Administration, the 97th Congress enacted the Product Liability Risk

Retention Act of 1981.121 This act sought to lower insurance costs by permitting businesses to

form self-insurance pools.122 Subsequently, the 98th Congress enacted the Clarification of the

Product Liability Risk Retention Act of 1981.123 This statute was intended to permit “product

manufactures, sellers, and distributors to purchase … insurance on a group basis or to self-insure

(...continued)

intended federal regulation to be exclusive—and conflict preemption—which occurs when it is impossible to comply

with both federal and state law at the same time or when a state law presents an obstacle to executing the entire scope

of Congress’s purpose and objectives. See Fla. Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132, 142-43 (1963);

Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947) (noting that congressional intent to occupy a field may be

inferred where federal regulation is so “pervasive” or “so dominant” that it can be assumed federal law did not intend

for state and local laws to supplement it).

116

See Riegal v. Medtronic, Inc., 552 U.S. 312, 321-22 (2008); see also Medtronic, Inc. v. Lohr, 518 U.S. 470, 512

(1996).

117

Federal Cigarette Labeling and Advertising Act, P.L. 89-92, 79 Stat. 282 (1965) (codified at 15 U.S.C. §§1331 et

seq.).

118

See Cipollone v. Liggett Group, Inc., 505 U.S. 504, 524-29 (1992).

119

21 U.S.C. §360k(a).

120

Riegel, 552 U.S. at 320, 330.

121

P.L. 97-45 (1981)

122

See Schwartz & Behrens, supra note 103, at 1365.

123

P.L. 98-193 (1983).

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through insurance cooperatives called ‘risk retention groups.’”124 Federal legislation was

necessary to accomplish this because many states have laws that would make the formation of

such groups impractical on an interstate basis. The federal statute therefore exempts purchasing

groups and risk retention groups from most regulation by states other than ones in which they are

chartered. Furthermore, the 99th Congress enacted the Risk Retention Amendments of 1986,125

which expanded the scope of Product Liability Risk Retention Act of 1981 to enable risk

retention groups and purchasing groups to provide all types of liability insurance, not only

products liability insurance. It renamed the act the Liability Risk Retention Act of 1986.126

The 99th Congress also enacted the National Childhood Vaccine Injury Act of 1986.127 As

amended, the act requires most persons suffering vaccine-related injuries, prior to filing a tort

action, to file a claim in the U.S. Court of Federal Claims for no-fault compensation through the

National Vaccine Injury Compensation Program established by the act. Under the program,

compensation for pain and suffering is limited to $250,000. A party not satisfied with the

compensation awarded under the program may file a tort action under state law, but subject to

some limitations. Although recovery under the program is limited, it was hoped that “the relative

certainty and generosity of the system’s awards [would] divert a significant number of potential

plaintiffs from litigation.”128

During President Clinton’s Administration, the 103rd Congress in 1994 enacted the General

Aviation Revitalization Act,129 which established an 18-year statute of repose for planes with

fewer than 20 seats that are not used in scheduled service at the time of the incident. With

exceptions, this law prevents civil actions against the manufacturers of such an aircraft or aircraft

components to be brought if any of their products are 18 years or older at the time of the

accident.130 The 104th Congress also enacted the Bill Emerson Good Samaritan Food Donation

Act,131 which limits civil liability for a person or gleaner (“a person who harvests for free

distribution to the needy”), except in cases of gross negligence or intentional misconduct, who

donates apparently wholesome food or an apparently fit grocery product “in good faith to a nonprofit organization for ultimate distribution to needy individuals.” It also limits liability of the

nonprofit organization that receives the donation, except in cases of gross negligence or

intentional misconduct. In addition, the 104th Congress passed H.R. 956, the Product Liability

Fairness Act of 1995, but President Clinton vetoed it.

During the remainder of Clinton’s tenure, other laws passed include the Biomaterials Access

Assurance Act of 1998132 during the 105th Congress. This act limits the products liability under

124

S.Rept. 97-192 (1981).

P.L. 99-563 (1986).

126

15 U.S.C. §§3901 et seq.

127

P.L. 99-660 (1986); 42 U.S.C. §§300aa-1 et seq.

128

H.Rept. 99-908, pt. 1, at 13 (1986). For more information on the National Childhood Vaccine Injury Act of 1986,

see CRS Report R41538, The National Childhood Vaccine Injury Act and Preemption: An Overview of Bruesewitz v.

Wyeth, by (name redacted).

129

P.L. 103-298 (1994) codified at 49 U.S.C. §40101 note.

130

In other words, a claim must be filed within the first 18 years that the aircraft is first delivered to the purchaser or

lessee, or the individual engaged in buying the aircraft. However, the statute of repose appears to begin again if a

component is replaced by the manufacturer. Therefore, it could be possible for a 20-year old aircraft to be the object of

a successful lawsuit if it contains manufacture modifications or parts installed within the last 18 years.

131

P.L. 104-210 (1996).

132

P.L. 105-230 (1998).

125

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state law of biomaterials suppliers, which it defines as an entity that supplies a component part or

raw materials for use in the manufacture of an implant. In 1999, the 106th Congress enacted the

Y2K Act,133 which limits contractual and tort liability under state law in suits, other than those for

personal injury or wrongful death, “in which the plaintiff’s alleged harm or injury arises from or

is related to an actual or potential Y2K failure….”

During President George W. Bush’s Administration, the 107th Congress enacted the Homeland

Security Act of 2002,134 three sections of which limit the products liability of various defendants.

Section 304 immunizes manufacturers and administrators of smallpox vaccine from liability.

Section 863 limits the liability of sellers of antiterrorism technology, and Sections 1714-1717

limit the liability of manufacturers and administrators of the components and ingredients of

vaccines.135 Sections 1714-1717 of this act were repealed when the 108th Congress enacted the

Consolidated Appropriations Resolution, 2003, Division L, Section 102.136

In 2005, the 109th Congress enacted the Protection of Lawful Commerce in Arms Act137

(PLCAA). It prohibits “a civil action or proceeding or an administrative proceeding,” except in

six circumstances, against a manufacturer or seller of a firearm or ammunition, or a trade

association, for damages “resulting from the criminal or unlawful misuse” of a firearm or

ammunition. Section 5 of the PLCAA is a separate provision called the Child Safety Lock Act of

2005. With exceptions, it requires a “secure gun storage or safety device” (as defined in 18 U.S.C.

§921(a)(34)) on handguns, and provides that a person who has lawful possession and control of a

handgun, and who uses such a device, is entitled to the same immunity as granted to gun

manufacturers, sellers, and trade associations by the PLCAA.

The 109th Congress also enacted the Public Readiness Emergency Preparedness Act (PREP

Act).138 Division C of the PREP Act limits liability with respect to pandemic flu and other public

health countermeasures upon a declaration by the Secretary of Health and Human Services of a

public health emergency or the credible risk of such emergency. In lieu of suing, victims may

accept payment under the “Covered Countermeasure Process Fund” if Congress appropriates

money for this fund.139

133

P.L. 106-37 (1999).

P.L. 107-296 (2002).

135

See CRS Report RL31649, Homeland Security Act of 2002: Tort Liability Provisions, by (name redacted).

136

P.L. 108-7 (2003).

137

P.L. 109-92 (2005). See also CRS Report R42871, The Protection of Lawful Commerce in Arms Act: An Overview

of Limiting Tort Liability of Gun Manufacturers, by (name redacted).

138

P.L. 109-148 (2005).

139

See CRS Report RS22327, Pandemic Flu and Medical Biodefense Countermeasure Liability Limitation, by (name r

edacted).

134

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Appendix. Glossary of Terms

The extent to which each of the following concepts is applicable in particular products liability

lawsuits depends upon the relevant state law.

Alteration of product. A possible contributing cause to an injury that may be performed by a

plaintiff or a third party, such as a plaintiff’s employer; it may reduce or eliminate a defendant’s

liability.

Assumption of risk. A form of contributory fault by a plaintiff; it may reduce or eliminate a

defendant’s liability.

Breach of warranty. A basis for liability that permits the defendant to raise certain contract law

defenses to avoid liability, but does not require the plaintiff to prove that the defendant was

negligent.

Collateral source. A source, such as an insurance company or governmental entity, that

compensates an injured party for the injury, and may, through subrogation, be entitled to recover

such compensation paid out to the injured party.

Collateral source rule. The rule that a plaintiff’s damages will not be reduced by amounts she

recovered from sources other than the defendant, such as health insurance benefits.

Comparative negligence. The rule that plaintiff’s recovery will be reduced in proportion to the

degree that her own negligence (or other fault) was responsible for his injury. In its modified

form, recovery is barred if the plaintiff’s responsibility exceeds a specific degree, such as 50%.

Contributory negligence. Negligence (or other fault) on the part of the plaintiff that is wholly or

partially responsible for his injury. In a few states, any degree of contributory negligence will

totally bar recovery.

Design defect. A defect resulting from a product that, although manufactured as it had been

designed, was not designed as safely as it should have been.

Economic damages. Out-of-pocket expenses incurred by the plaintiff, such as medical bills or

loss of income.

Failure to warn. A defect consisting of the defendant’s failure to provide adequate warnings or

instructions regarding the use of its product.

Government contractor defense. A rule established by the Supreme Court in Boyle v. United

Technologies Corp., 487 U.S. 500 (1988), that enables a defendant whose product complied with

federal government contract specifications to avoid liability in some cases.

Government standards defense. A rule in a few states enabling a defendant whose product

complied with government safety standards to avoid liability or to establish a presumption that its

product was not defective.

Joint and several liability. The rule that each defendant who contributes to causing a plaintiff’s

injury may be held individually liable for the total damages.

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Lawyers’ contingent fees. Fees payable only upon recovery of damages, based upon a

percentage of the recovery.

Manufacturing defect. A defect resulting from a product’s not having been manufactured as it

had been designed. Compare with “Design defect,” supra.

Market share liability. Liability for the percentage of a plaintiff’s damages equal to the

defendant’s market share of the injury-causing product; a few cases have held market share

liability applicable where a plaintiff cannot prove that a particular defendant manufactured the

injury-causing product.

Misuse of product. A form of contributory fault by a plaintiff; it may reduce or eliminate a

defendant’s liability.

Negligence. Breach of a duty to exercise duty care; it is the traditional nonintentional tort

standard in cases not based upon strict liability.

No-fault recovery. Recovery permitted in the absence of fault; it is not the law in any state with

respect to products liability. If adopted in the products liability context, it would permit recovery

in the absence not only of negligence (as strict tort liability does), but in the absence of a product

defect.

Noneconomic damages. Damages payable for items other than out-of-pocket expenses such as

pain and suffering or punitive damages. Statutory caps on noneconomic damages, however, are

generally distinct from statutory caps on punitive damages.

Patent danger rule. The rule that a manufacturer is not liable for an injury caused by a design

defect if the danger should have been obvious to the product user.

Periodic payments of future damages. Payments by a defendant for a plaintiff’s future expenses

on a periodic basis rather than in lump sum.

Post-manufacturing improvements. Improvements in a product’s design that occur after an

injury and which plaintiffs seek to introduce in court as evidence that an injury-causing product

was defective.

Punitive damages. Damages awarded, in addition to economic damages and other noneconomic

damages, to punish a defendant for willful or wanton conduct. (Also called “exemplary

damages.”)

Restatement (Second) Torts. A statement of tort law written by legal scholars; Section 402A,

which provides for strict tort liability for injuries caused by defective products, has been adopted

by most states. On May 20, 1997, the American Law Institute adopted Restatement of the Law

(3d), Torts: Product Liability, which is intended to replace section 402A.

State of the art defense. The defense that permits a defendant to avoid liability in a design defect

case if at the time of manufacture there was no feasible safer design available, or in a failure-towarn case if at the time of manufacture there was no reasonable way that the defendant could

have known of the danger he failed to warn against.

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Statute of limitations. A statute specifying the number of years after injury occurs, or is

discovered, or its cause is discovered, within which suit must be filed.

Statute of repose. A statute specifying the number of years after a product is first sold or

distributed within which suit must be filed; it supplements the statute of limitations.

Manufacturers favor statutes of repose because they preclude recovery when products are old;

consumers oppose them because they result in suits being barred before injuries even occur.

Strict tort liability. Liability established if a plaintiff proves that a product defect caused an

injury; the plaintiff need not prove that the defendant was negligent.

Subrogation. The right of a collateral source, such as an insurance company or governmental

entity, that compensates an injured party to recover the amount paid to injured party by taking

over the injured party’s right to recover from the person who caused the injury.

Useful life limitation. A period of time set forth by statute after which a product’s useful life is

deemed over and suit is barred or a presumption that the product was not defective is created; this

is similar to a statute of repose.

Workers’ compensation. Statutes in every state providing for limited no-fault compensation

against employers by workers injured on the job. Receipt of such compensation ordinarily

precludes an employee from suing his employer; it does not preclude him from suing a product

manufacturer.

Author Contact Information

(name redacted)

Legislative Attorney

[redacted]@crs.loc.gov, 7-....

Acknowledgments

Thomas Bryan, Law Clerk, contributed to the research and writing of this report.

Congressional Research Service

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