Strict Products Liability/Workers Comp/Punitive Damages

Question 1

Products Liability

Answer 1

Provides that a manufacturer or distributor is liable if:

• its product is defective,
• the defect existed when the product left its hands, and
• the defect caused injury to an end-user that was reasonably foreseeable

Most Products Liability cases are under Strict Liability, but some are under Res Ipsa Loquitur

The seller must be a merchant (can’t use someone under products liability if they are a one time seller)

Question 2

MacPherson v. Buick Motor Co

Answer 2

Products Liability - broadens liability to all products (not just inherently dangerous ones)

F: Buick manufactured a car that collapsed while P was driving b/c of a defective wooden wheel. Wheel wasn’t made by Buick, but bought from another manufacturer, but defect could’ve been discovered by a reasonable inspection. P did not buy it directly from Buick.

I: Does Buick owe a duty to anyone besides the immediate purchaser?

H: Yes. Buick was responsible for the finished product even if they didn’t make the defective wheel. Had a duty to someone who didn’t directly buy it from them, b/c they knew it would be used by someone other than direct purchaser. Buick was obligated to perform an inspection and didn’t. The more probable the danger, the greater the need of caution. If an item is likely to cause injury or death when it’s made with a defect, then the item is dangerous.

Question 3

Escola v. Coca Cola

Answer 3

Products Liability & Res Ipsa Loquitur

F: P was injured when a pop bottle broke in her hand as she moved it from the case to the fridge

I: Should Coke be liable under the theory of res ipsa loquitur?

H: Yes. Coke only had test for visual inspection of newly made bottles, but they also recycled old ones which were not subjected to the same test.

Dissent by Traynor: Said court should’ve used strict liability instead of Res Ipsa/negligence. D could easily object to negligence b/c of the millions of bottles, only one exploded (not really negligence). Argues that manufacturers should be under strict liability standard

Question 4

Product Defects

Section 2 - Third Restatement

Answer 4

1. 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 warnings

A product:

(a) contains a manufacturing defect when the product departs from its intended design even though all possible care was exercised in the prep and marketing of the product
(b) is defective in design when the foreseeable risks of harm posed by the product could’ve been reduced or avoided by the adoption of a reasonable alternative design by the seller, other distributor, or a predecessor in the commercial chain of distribution, and the omission of the alternative design render the product not reasonably safe
(c) is defective b/c of inadequate instructions or warnings when the foreseeable risks of harm posed by the product could’ve been reduced or avoided by the provision of reasonable instructions or warnings by the seller or other distributor, or a predecessor in the commercial chain of distribution, and the omission of the instructions or warnings renders the product not reasonably safe

Question 5

Product Defects

Section 3 - Third Restatement

Answer 5

1. It may be inferred that the harm sustained by the P was caused by a product defect existing at the time of sale or distribution, without proof of a specific defect, when the incident that harmed the P;
   (a) was of a kind that ordinarily occurs as a result of product defect; and
   (b) was not, in the particular case, solely the result of causes other than product defect existing at the time of sale or distribution
   - sort of like res ipsa

Question 6

Manufacturing Defects

Section 2(a) of Third Restatement

Answer 6

• Usually involves latent (not easily discernable) defects, rather than patent
• Court considers when the defect could have occurred - if the defect must have been introduced in the D’s hands –> strict liability
  
  • if the defect had to have occurred before the sale and there were multiple potential sources of the defect, each source/seller could be liable
• Ps don’t need to have product as evidence - testimony or circumstantial evidence can be enough
• Imposing strict products liability encourages greater investment in product safety than does a regime of fault-based liability (where sellers may escape their appropriate share of liability)

Question 7

Design Defect

Section 2(b) of Third Restatement

Answer 7

• a commonly shared design is a defining characteristic of a product line. Consequently, an allegation of defective design implicates the entire product line - substantially expands manufacturer’s liability
• Two methods to determine if there is a design defect:
  
  • if the product failed to perform as safely as an ordinary consumer would expect when used as an intended or reasonably foreseeable manner
  • If through hindsight the jury determines that the product’s design embodies ‘excessive preventable danger’ - the risk of danger inherent in the design outweighs the benefits of such design
    
    • the jury would consider the gravity of the danger, its likelihood, feasible alternative, the cost of the alternative, and the adverse consequences to the product and consumer
• Difficult to determine what is a design defect. What’s the standard? Are motorcycles defective for only having two wheels? Are all table saw that don’t have “SawStop”?

Question 8

Failure to Warn

Product Defects Section 2(c) of Third Restatement

Answer 8

• Defective b/c of inadequate instructions or warnings when the foreseeable risks of harm posed by the product could have been reduced or avoided by the provision of reasonable instructions or warnings
• Two Broad Categories
  
  • total failure to warn
  • inadequate warning
• Ds tend to like this section, b/c it can get them off the hook if they have warnings on their material

Question 9

Soule v. General Motors Corp

Answer 9

Products Liability

F: woman - not wearing seatbelt - injured leg in car accident, where she says car had a defective design - wheel collapsed into the underside of the toe pan and crumpled it

I: Was the design of the car defective and therefore subject to strict liability?

H: Yes. Court chose not to use the consumer expectations test, but rather used the excessive preventable danger. See Barker v. Lull Test. Expert testimony at trial centered on these issues.

Consumer Expectations test:

• used for cases in which everyday experience of the product’s users permits a conclusion that the product’s design violated minimum safety assumptions and is defective regardless of expert opinions on the design
• unless facts actually permit an inference that the product’s performance didn’t meet the safety expectations of ordinary users, jury must apply second prong of Barker test weighing risks and benefits.

Question 10

Barker v. Lull Test

Answer 10

Two Prongs:

1. Consumer Expectations Test: if a product doesn’t conform to consumer expectations, it is dangerous to a degree not foreseeable to consumers. P was harmed substantially due to product’s design
2. Risk Utility Test (pro-plaintiff): Ps must allege that the product is not risk utility justified, then the burden is on the D to show it is risk utility justified. P needs to show the risk of danger inherent in the design outweighs the benefits of such design

**THIS IS NOT NEGLIGENCE - looking at the condition of the product. P can still bring in a negligence or intentional tort claim if she wants, but difficult to prove

Question 11

Elements of Risk Utility Test-Cost/Benefits of Manufacture

2nd Prong of Barker Test

Answer 11

1. The gravity of the potential harm resulting from the use of the product
2. The liklihood that this harm would occur
3. The feasibility of an alternative safer design at the time of manufacture
4. The cost of an alternative design
5. The disadvantages of an alternative design

Question 12

Strict Products Liability in 2nd Restatement

Answer 12

Plaintiff must demonstrate that the product causing the injuries was in a “defective condition unreasonably dangerous” to person or property at the time it left D’s possession.

Later revised to remove “unreasonably dangerous” language b/c it sounds like negligence

Question 13

Hood v. Ryobi

Answer 13

Products Liability

F: P was using a saw that had guards on it. Guards contained warning that said not to remove them and that removing them coud cause serious physical injury. P removed the guards, blade spun off and injured him.

I: Was Ryobi liable on the basis that its warnings were inadequate b/c they didn’t state would could occur if guards were removed?

H: No. Ryobi’s warnings were clear and sufficient to apprise the ordinary customer that it was unsafe to operate the saw without guards. Warning just needs to be reasonable under the circumstances

Too detailed of warnings may defeat the purpose (people won’t read them if they’re long)

Question 14

State v. Karl

Answer 14

Products Liability

F: P died after taking Propulsid, a drug manufactured and distributed by Janssen. P’s estate sued Janssen.

I: Does WV products liability law hold prescription drug manufacturers to the same duty to warn as the manufacturers of other products?

H: Yes. WV doesn’t recognize the learned intermediary doctrine which would provide an exception to the duty to warn for pharmaceutical companies (shifts responsbility for failure to warn from the manufacturer to the doctors)

Slight majority of states have adopted intermediary doctrine but their justifications for doing so are outdated (informed consent laws make it so patients have to make more decisions/doctors have less time with patents) and unpersuasive.

Reasons:

1. it’s difficult for manufacturers to have to warn the ultimate users of the drugs
2. Patients rely on the judgment of their doctor
3. physicians are the ones selecting the drugs to be prescribed
4. physicians are in the best position to provide the appropriate warnings to their patients
5. concern that warning consumers directly might interfere with the doctor/patient relationship

Question 15

Third Restatement Exceptions to Learned Intermediary Doctrine

Answer 15

1. If pharmaceutical companies can be required to warn consumers under this exception, then they should always be able to do so
2. A requirement to warn consumers of the risks of a prescription drug is not unreasonable given that the company receives the financial benefit of the sale of the drug and the consumer bears the risks of using it
3. Doctors have certain duties and responsibilites concerning prescribing medications and the manufacturers should carry some of that responsibility as well

Question 16

Defenses to Strict Products Liability

Answer 16

1. Carelessness of the Plaintiff (Contributorily Negligent)
   
   1. not an affirmative defense
2. Knowing Plaintiff - P knew about the defect and still used it anyway
   
   1. not necessarily complete defense
      
      1. most states use comparative negligence, s if P is also negligent D can reduce damages
3. Adequate Warning on the Product
4. Statutes of Repose
   
   1. like statute of limitations but starts when product is first sold

Disclaimers and contractual waivers do not bar valid products liability claims against sellers

Question 17

Prima Facie Case for Strict Products Liability (Barbri)

Answer 17

1. Seller of product must be a merchant
2. The product must have a defect
   
   1. manufacturing defect (different from all other products from same seller)
   2. design defect (all the products in that line are defective)
3. Defect existed when product left hands of seller
   
   1. presumption: if the product was moved in ordinary channels of distribution, give P benefit of doubt
4. P has to show she was using the product in a foreseeable way
   
   1. Doesn’t necessarily have to be for the intended purpose for why it was designed, just that it is foreseeable (ex: standing on chair to grab something from up high)
5. Can’t use strict products liability when the product is tangental to the transaction
   
   1. ex: you go to hospital to get blood transfusion - can’t sue “manufacturer” for faulty blood – likely negligence claim

Question 18

Vassallo v. Baxter Healthcare Corp

Answer 18

Products Liability

F: P got surgery for breast implants and later sufferent from an autoimmune disease. P claimed negligent design, negligent product warnings, and breach of implied warranty of merchantability.

I: Should the court change its products liability law concerning the implied warranty of merchantability so it can adopt a standard that conditions a maufacturer’s liability on actual or constructive knowledge of the risks?

H: Yes. Rejects previous law that presumes manufacturer was fully informed of all risks associated with the product at issue (including those not reasonably foreseeable) and amounts to strict liability for failure to warn of these risks. (Too strict for manufacturer).

Adopts new test under 3rd Restatement:

• manufacturer need only warn of the risks known or reasonably known in light of the generally accepted scientific knowledge available at the time of the manufacture and distribution of the device.
• held to standard of knowledge of expert in field

Question 19

General Motors v. Sanchez, 1999

Answer 19

Products Liability - Defenses

F: Sanchez’s truck rolled backward while he was standing behind it and pinned him to a gate between the open door and a fence. He bled to death. His wife sued GM based on a defect in the truck’s transmission where Sanchez allegedly shifted the car and it was between Park and Reverse (in neutral) then slipped to reverse.

I: Can GM’s (Ds) damages be reduced due to comparative negligence of P?

H: Yes. While a consumer is not responsible for discovering or guarding aginast a product defect, that consumer’s negligent conduct could allow for a reduction in damages for comparative responsibility even in strict liability cases. P was negligent b/c he failed to perform the safety measures described in the manual that would’ve avoided the accident

reduction is based on the percentage of responsibility attributed to P by trier of fact

Question 20

Jones v. Ryobi, 1994

Answer 20

Products Liability - Modification

F: P worked for printing press operator. P’s employer removed plastic guard on printer and disabled a switch that prevented it from working w/o the guard. P was injured while using modified product and sued manufacturer.

I: When a third party modifies a product and renders it unsafe, is the manufacturer liable?

H: No. Even if the modification is foreseeable, the manufacturer is not liable. Defect has to exist at the time product leaves the Ds hands.

Good Arguments for Why it was Defective:

1. Printer was inefficient without modification
2. Industry practice was to remove the gaurd (98% of people did it)
3. There were reasonably alternative designs
4. Foreseeable misuse

Some courts have adopted this 4th element and have said a manufacturer is liable for modified products when the modification is foreseeable.

Question 21

Royer v. Catholic Medical Center

Answer 21

Products Liability

F: P underwent knee replacement surgery at Ds Hospital. The knee was defective and had to be replaced with a second surgery. P sued D under strict liability theory for selling the defectively designed product - it was charged separately. D argued that it wasn’t the seller.

I: Is a health care provider that supplies a prosthetic device considered a seller of the prosthetic under strict products liability law?

H: No. Seller must be engaged in the business of selling such a product to be subject to strict products liability. Health providers primarily render services and the provision of prosthetic devices is only incidental to the service being provided. Passing on this liability would make hospitals even more expensive.

Counter: Shouldn’t the doctor be held liable for choosing a defective product?

Response: We need to draw the line somewhere and we should extend strict liability to the rendition of services using the faulty product. Just like contractors are strictly liable if their work results in defective building b/c of defective material (delivering a service, not a product)

Question 22

Liriano v. Hobart Corp, 1998

Answer 22

Products Liability - Warnings

F: P used a meat grinder at work and his employe had removed the safety guard. Grinder didn’t have a written warning printed on it warning against using it w/o safety guard. P lost his arm while using the modified grinder and sued the manufacturer for negligence and strict products liability for defective design and failure to warn.

I: When a manufacturer wouln’t be liable for defective design b/c of substantial modification by a third party, can the manufacturer still be found liable for failing to warn of the danger caused by that modification?

H: Yes. A manufacturer is liable for failing to warn against a foreseeable modification of its product.

Two kinds of warnings:

1. Warns you about a risk or danger
2. Warns you to avoid activity that increases the risk (this is the one that would have been useful in this case)

Question 23

Workers Comp & Pros v. Cons

Answer 23

• Def: an arrangement between employees and employers that the employer will pay benefits for any occupational injury, regardless of the employer’s liability under tort law
• In exchange, employees cannot sue employers (Exclusive Remedy Provision)

Pros:

• Employers like it b/c it’s cheaper than tort law suits
• Employees like it b/c they’re guaranteed something and will get it right away

Cons:

• Even if the employer is negligent, the employer will emerge scot-free from any financial contribution to compensate the injuries if tort liability happens to be fixed on a third party
  
  • The damages paid by third party will pay for the amount that would be paid under workers comp

Question 24

Different Courts Approaches to Workers Comp

Answer 24

• Some courts ignore the workers comp exclusivity principle and simply impose burdens among all negligent actors
  
  • problem: the employer will have an additional financial burden for injuries in its workplace over and above the funds for WC
• Other Courts say the employer is required to contribute a share of the injured worker’s damage award - but only up to the amount it would pay under WC
  
  • Helps offset payments required by manufacturer and P still gets fully recompensed
  • Still encourages employers to avoid workplace injuries from “defective” products
  • Problem: makes assigning fault to parties more complicated
• Report from casebook: get rid of employers from this process altogether
  
  • Eliminate subrogation - don’t allow employer’s insurance company get involved in employees suit
  • manufacturer’s tort liability would only be reduced by the WC benefit paid by employer
    
    • differs from above b/c above would reduce manufacturer’s liability based on culpability of employer

Question 25

Single Judgment Rule

Answer 25

Plaintiff can only sue once and can only get one judgment

• issue is that the injury may not have fully set by the time the P first sues
• Statute of Limitations - all the damage may not have occurred by that time
• Results in frequent over or under compensation

Question 26

Seffert v. Los Angeles Transit Line, 1961

Answer 26

Punitive Damages

F: P was caught in the door of a bus run by D and dragged some distance before being thrown to the ground. Before accident, P was healthy and had been supporting herself for 20 years. After accident, suffered severe, disabling, and permanent injuries which will cause pain for the rest of her life. Jury awarded P $54,000 for injuries and $134,000 for pain and suffering.

I: Is a damages award excessive as a matter of law if it fails to “shock the conscience” or indicate passion, prejudice, or corruption on the part of the jurors?

H: No. Court don’t really mess with lower courts awards of damages unless it “shocks the conscience” - especially when damages are dfficult to quatify. P’s pecuniary losses were supported by substantial evidence and the jury are the ones who actually listened to the facts and witnesses.

Dissent by Traynor: Pain and suffering award was excessive based on precedent

Question 27

Mathias v. Accor Economy Lodging, Inc.

Answer 27

Damages - Could’ve been filed as Intentional Tort

F: Ps checked into hotel where they were bitten by bedbugs. P sued D alleging that it knew of the bedbug problem and ignored it amounting to “willful and wanton conduct”. Evidence showed that it did know and rented the room out anyway. Ps were awarded punitive damages.

I: Must a punitive damages award imposed against a D be supported by sufficient evidence that the D’s actions amounted to willful and wanton conduct?

H: Yes. Ps succesffuly showed that in this case (had cleaning crews in and that specific room was scheduled to be fumagated). It’s a good idea to use punitive damages when the likelihood of detection is low, b/c there’s a risk that when detection is low, people will engage in more of that conduct. Want to prevent people from doing it.