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A Viable Product vs. The Legal System

By: Dr. C.J. Abraham
Tel: 516-482-5374
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ABSTRACT

In the United States, the most litigious country in the world, a products liability action may be brought, under state law, for express or implied breach of warranty, misrepresentation and negligence. Under the theory of strict liability, a lawsuit may be initiated on the grounds of manufacturing and design defects as well as poor and inadequate warning instructions. The best defensive strategy for a company to avoid becoming involved in any of the above is to manufacture the safest product possible within parameters of economic feasibility. If said manufacturer can vouch for safety factors in the design, production, testing, inspection and evaluation of its product as well as attentiveness to consumer complaints, it will be more likely to avoid litigation or at least be able to prevail in the courtroom. This paper will discuss the creation of a potentially safe product: the protocol involved in the development, prototype testing, engineering evaluation, hazard analysis, and the production of warnings and instructions. It will also emphasize the factors necessary to keep a company from becoming entangled in the legal system so that it can spend more money on product improvement, product safety and viability.

Introduction

This paper is concerned with how a manufacturer can produce a viable product while adhering to major consumer safety programs as well as voluntary and federal statutes. At the same time, consumer expectations and their safety must be considered. Attempts by the government to create consumer safety programs over the last forty years have been partially effective. However, the administration of said programs has been marked by excessive timidity and inordinate delay. The effectiveness of consumer protection programs are all the more alarming because, by and large, Congress has granted to the various agencies concerned powers general inadequate to deal with the regulatory problems involved. While Congress has committed vast paper power to agency discretion, it has failed to provide for agency resources commensurate with the regulatory problems presented. As a result, there exists the fate of consumer protection programs, but not the reality. Congress has not provided adequate funds to create and regulate programs for the protection of consumers. Too often, this results in a dependency on industry for data needed to develop standards and on cumbersome contracting procedures and private facilities for compliance testing and defect discovery.

The various consumer agencies have also contributed to their own ineffectiveness. The National Highway Traffic Safety Administration (NHTSA), the Food and Drug Administration (FDA), the Consumer Product Safety Commission (CPSC), the Department of Commerce, are prime examples. For years they have failed to meet public demands for adequate appropriations to implement their various programs involving consumer safety. These agencies have seemingly bent over backwards to erect cumbersome administrative procedures for the promulgation of various standards; they have failed to take vigorous enforcement action to require stiff civil penalties from manufacturers for non-compliant products. As a result, they have impaired the credibility of their enforcement stances. These agencies, in their relationships with various manufacturers, appear to be accommodating regulated industry and, therefore, avoiding a major conflict. The timidity with which the said agencies approach their tasks seems endemic to the administrative process established for consumer protection.

The financial, technical and legal resources of the regulated industries are far greater than those of the various government agencies. As a result, the administrators of each of the agencies fear that a major conflict in rulemaking or enforcement would tie up so much of any agency's resources that its ability to implement its program would be delayed significantly. There is also a fear that the entrenched economic interest that the agencies regulate would retaliate through the legislative process, particularly through appropriations. This would certainly conflict with a legislator's interest in his constituency since a particular manufacturing plant in his or her district or state might be more important to the local economic interest than to the generalized consumer interests. Administrators running the various government programs find that their agencies lack resources and staff, to provide their programs with sufficient data necessary to withstand the challenge from the corresponding regulated industry.

Continuous communication with representatives from the various regulated industries has caused agency preoccupation with the economic burdens resulting in the delay, dilution and the minimization of specific safety standards. The government's requirement of multiple layers of review preceding any final decision produces conflicting interests within the agencies, among the legislators and the public. It also creates a stalemate that allows the industry's representative to delve into the weaknesses that are conducive to continual delays. In summary, the consumer regulatory process over the last forty years has been too often nothing more than a dialogue between the government and industry with informal communications that are not open to public scrutiny, and are not particularly effective.

Thus, it is evident that urgent problems relating to public safety have not been handled expeditiously by government agencies. As long as these conditions persist, each of the agencies will serve mainly to insulate resistant industry from legitimate public demands for safer consumer products. It is known that, to date, neither self-interest nor competition has influenced manufacturers to produce products that are as safe as possible. Petition and voluntary actions of industry do not take the form of rivalry to produce the safest product. In many instances, the competitive struggle to exist may lead to a lowering or shaving of the cost of manufacturing which results in some sacrifice of safety. Additionally, the competition between corporations often does not result in greater volume and higher profits when "safety" is being sold as a feature of the product.

When an individual is injured while using or coming into contact with a product, the issue is not one of product liability per se, but product safety. Were it not for the consumers bringing numerous products liabilities claims into the courts each year, life in the United States would be much more hazardous. If, for example, an automobile manufacturer never had to consider a recall or redesign of a defective car, or a retailer could market flammable children's clothing or cancer causing asbestos was still used to insulate schools, offices and factories, there would be ongoing injuries without any impetus to make safer products. The effect of the legal profession on consumer safety has significantly affected corporate decision-making as to the quality of products.

The current products liability system as promulgated by the American legal system, promotes safety by forcing manufacturers to carefully design, produce and create adequate warnings and instructions. As a result, manufacturing procedures have improved and labels and use instructions are more explicit. Section 15 (b) (2) of the CPSA (16 CFR Part 115 (1979) requires every manufacturer (including importers, distributors and retailers) of a consumer product who obtains information which reasonably supports the conclusion that the product contains a defect which could create a substantial product hazard to inform the Commission of such a defect. Very few companies, if any, comply with the requirement.

A defect is a fault, flaw, or irregularity that causes weakness, failure, or inadequacy in form or function. It may be the result of a manufacturing or production error; that is, the consumer product, as manufactured, is not in the form intended by, or fails to perform in accordance with its design. In addition, the design of and the materials used in a product may also be defective. Interestingly, a product may contain a defect even if it is manufactured in accordance with its design and specifications, if the redesign is a risk of injury to the public. A defect may also be present in a product's content, construction, finish, packaging, warnings and/or instructions. A product is deemed defective if its instructions for assembly and/or use allow said product, otherwise safely designed and manufactured, to possess a risk of injury.

Dangers Of A Well Made Product

A product may be defective even if it is neither defectively manufactured or designed. The courts have long held that the failure to warn of a product's potential hazard is an inherent defect, invoking all of the trappings of products liability. There are four basic elements in a failure to warn case:

  1. The manufacturer knew, or should have known, the risk inherent in the product;
  2. There was no warning, or in the alternative, the warning provided was inadequate;
  3. The absence of a warning made the product unreasonably dangerous; and
  4. The failure to warn was the cause-in-fact approximate cause of the plaintiff's injury.

Foreseeable users of products are entitled to all safety information by virtue of the case law of almost every jurisdiction. It also has been held that an adequate warning is one calculated to bring home to a reasonably prudent user of a product, the nature and extent of the dangers involved. Manufacturers are encouraged to create warnings and to give instructions that the consumer is going to observe and be guided by. This is an extremely important concept.

Design Analysis

Many recreational and sports cases involve more than just inadequate warnings and instructions. They are usually defective design cases as well. It should be determined, after identifying the safety hazard, whether the danger could have been eliminated or avoided by an alternative/better design. A product containing such a safety hazard is not made safe by an allegedly adequate warning. The manufacturer should resort to written warnings and cautions only after it has made every attempt to design the hazard-related feature out of the device. The emphasis made during depositions and interrogatories of the manufacturer's representatives and experts is, initially, not whether the danger is adequately described by the warning, but whether the danger could have been eliminated by a design change. Verification of design improvements are available in the general scientific and technological literature, or in trade publications, industry literature or patent search. There are times when a competitive product contains the design modification that would have eliminated the danger. The question is whether, based upon technology available, could a technical specialist suggest a design solution for the danger?

In many instances, the response to a proposed design change is that it would be too expensive or would hurt sales. If the design change was adopted, would it reduce profits or limit sales. If one can successfully establish the feasibility of a design solution, particularly one that was ignored by the manufacturer because of sales considerations, this would provide not only a moral imperative for a jury's finding against the defendant, but would also rebut traditional defenses as irrelevant.

The defendant's usual responses in a failure to warn case, include claims that:

  1. The risk was too remote to be warned of
  2. The product was used and the accident involved an unforeseeable user.
  3. The danger or risk was open and obvious.
  4. The warning was adequate.
  5. The user was sophisticated.
  6. In light of the then-existing reasonably available scientific and technical knowledge, the manufacturer could not have known the characteristic that caused the damage, or the danger of such characteristic.
  7. Misuse and alteration by the injured party.
  8. Experienced user.
  9. Assumption of risk

All of the above defenses have relatively no bearing in a case in which the danger could have been eliminated by a design alternative.

Another important aspect of a product defect and a duty to warn case is whether the company was ignorant of the danger because it did not do the testing necessary to discover it. What testing was performed by the company on its product for all of the product's foreseeable uses and misuses? It is important to determine who performed those tests, their background, the results and any communication resulting from those tests.

There are two unquestionable facts that will compel a jury to find fault with a manufacturer. First, if a manufacturer utilizes consulting experts whose responsibility it is to foresee or minimize injuries, and if the product is still not safe, the consulting expert as well as the manufacturer is at fault. If the product could not have been made safer, it is the manufacturer's duty to make sure that the consumer was properly warned and placed on notice. Second, it is always the objective of a manufacturer who is in business to make money. As a result, there are many instances where pressure is placed on employees to overlook or disguise dangers, and not to warn about them. When sales and safety are directly in conflict, it is usually the profit motive that prevails. This is because it always costs to perform further tests on the product to make it safer, or advertise its dangers.

One of the objectives of inquiry is to determine if the manufacturer knowingly sacrificed safety for sales. This information can usually be obtained through a detailed discovery of the defendant. Therefore, it is a manufacturer's duty when creating a product that may be dangerous or hazardous to the user, to have it fully researched by experts in safety, biomechanics, mechanical, design and safety engineering, and, most importantly in warnings. It should be noted that there are very few qualified warnings experts in the country who are able to critique and create warnings for consumers of all ages.

It is the responsibility and duty of a manufacturer to retain consulting experts who will analyze the inherent dangers and risks of using their particular product. Although the manufacturer's employees involved in the development, testing and analysis of a product are held to the highest level of expertise, consumers do not possess similar expertise and are presumed to possess ordinary intelligence. These consumers are dependent on and place their trust in the experts and the company that manufactures the product.

Creation of An Adequate Warning

In most instances, with a knowledgeable expert on warnings and instructions, a defective warning case is easiest to prove. A manufacturer has a duty to provide an effective warning. A plaintiff's injury is generally indicative of a warning that was not delivered or was ineffective.

Before creating warnings and instructions for any particular product, it is essential that the product be analyzed in terms of hazard and risk. Then, the operative facts, circumstances, and criteria that create an effective warning label must be understood. The interaction between the consumer and a potentially harmful product must be controlled if safety is to be achieved. The greater the potential for harm, the greater the amount of control required to achieve maximum safety. The essential means of control is through the use of adequate instructions. Warnings alert the consumer to any hazardous characteristic of the product when they are properly designed and presented. They motivate and instruct the consumer so that necessary and appropriate precautions can be taken to avoid injury. Warnings must be provided when the known hazard is an inherent feature of the product and exposure to that hazard is foreseeable. It is important that the manufacturer provide warnings that are clear, concise, complete and effective directives that will protect the individual's health and safety. In addition, the warnings and instructions should also protect visitors in the zone of danger or risk inherent in the application of the subject product.

The criteria for an effective warning are that it must be prominently displayed, and that it contain a clear, accurate, complete and effective message. The warning must successfully produce safe conduct, which meets established criteria derived from basic and well-known principles of perception, motivation, learning and reading level. A warning not meeting said criteria is unlikely to elicit safe behavior and, correspondingly, increases the likelihood of harm to the consumer. An effective warning will come into play during the time and in the place where such behavior is required. The warnings should motivate individuals to modify their behavior, tell them how to avoid harm, and what is to be done if they are injured.

For an effective warning, the criteria are:

  1. Present when needed- A warning given a long period prior to when it is required is less likely to modify or change the behavior of one that is given orally five minutes previously. A warning given immediately before the use of a product is even more likely to elicit a desired or safe response. The closer in time a warning is given in using a product, the more effective the warning is likely to be.
  2. Present where and when needed- A warning message must be physically present at the point where the incident may foreseeably occur to be effectively perceived. Any warning buried in the Owner's Manual(s) placed in protective equipment or printed in very small letters has low effectiveness compared to labels and warnings placed prominently on the outside of the package containing the product and on the product itself.
  3. Attract attention-Effective warnings will attract the attention of the user of a particular product. People cannot respond to stimuli they do not perceive.
  4. Motivate behavioral change-Motivation refers to conditions which affect the willingness of an individual to start upon or continue a sequence of behavior that will benefit him or her. Thus, an effective warning will answer the question, "Why should I obey?" The answer must be short and explicit, easily understood and effective. Weak warnings do not work. The phrase, "TO AVOID DEATH", is much more effective than, "TO AVOID THE POSSIBILITY OF PERSONAL INJURY". The consequences of not following the instructions must be clear and readily understood by the individual being warned. Behavior will not change if the consequences of failing to respond are remote or if the warning message does not state what will happen if the instructions are not followed.
  5. Instruct how to avoid foreseeable harm or risk-A clear, concise and complete instruction must be provided to the reader. An instruction such as, "WATCH YOUR STEP", is not as explicit as "STEP DOWN". Another commonly used instruction, "USE ONLY WITH ADEQUATE INSTRUCTION", does not define the word "ADEQUATE" to an ordinary layperson. Instructions detailing how to avoid the harm must be developed and written with a full understanding of the context of product use. The effectiveness of the message is directly dependent upon the product user's understanding and interpretation of the message.
  6. First Aid information must be provided- Up-to-date and tested first aid treatment and instructions must be provided.

The ultimate test for the effectiveness of warnings and instructions involves in-field testing. Market research techniques, which include in-depth interviews, focus-group interviews, surveys and consumer observation, can be used to evaluate warnings.

It is unreasonable for any manufacturer to claim that there is excessive cost for creating and placing an effective warning on a particular product. The actual cost is a fraction of a penny. The price for not placing one on a product can run into the millions. It is, therefore, prudent for the manufacturer to create effective warnings and instructions to protect not only the user of the product, but himself from strict liability claims.

Marketing Impact As A Reflection On Warnings

Brochures and owners manuals are normally designed by the sales or advertising department of a company. They generally pay "lip service" to consumer protection. "Lip service: exists so that in the event a company is sued, it can claim that there is concern for the consumer. However, the warnings and instructions will be placed on the back panel of products and never on the front panel. Nothing on the panel will upset our marketing program because most shelf products are purchased by impulse. Negative labeling is not healthy for the sales of any products." If a consumer, while shopping, sees a skull and crossbones, he or she might not reach for that product. There have been many cases won when lengthy instructions were provided, but no warnings. Manufacturers will, in many instances, not use or feature a warning because they do not want to risk losing sales. The consumer is entitled to both a warning and instructions.

One method of discovering a warnings and instructions defect is to depose the manufacture's advertising firm or representative. Once there is access to their files, obtain their TV tapes and records, it is easy to locate interesting marketing material that has nothing to do with safety. Further, one can determine that the defense claims citing bizarre conduct or contribution on the part of the plaintiff was actually within the contemplated usage of the product and was considered by the company's marketing program. After it is properly authenticated, the advertising brochure is often an admission against the author-corporation. In essence, the question is if there is a defect in the design or warnings, can a company justify that product being put into channels of commerce for general usage by the persons indicated.

It is not just pressures within a corporation that would account for the failure to investigate and then advertise the dangers of a product. Marketplace competition always plays a role. The fear of every corporation deliberating the necessity of adding a warning is that its competitor's salespersons would point to the warning as a negative distinguishing factor between comparable products.

In the marketing area, once an additional warning appears on one product within a generic family of products, that industry will, usually, uniformly accept the warning and add it to all similar products' labeling. This normally gives a jury a sense that there is an industry conspiracy not to use due care. Similarly, the absence of an additional industry-wide safety device or warning is not evidence of ay state-of-the-art inability to discover a specific danger or design defect. It is rather evidence of a marketplace reluctance to acknowledge this situation.

Letters and communications from distributors to the corporate office, medical reports relating to injuries using the company's products, and communications concerning to customer complaints are all collected and filed with the corporate office. It is usually a rare situation when a salesman is not recording something that he has observed or a story he has heard concerning dangers, risks or injuries involved with the company's products. These reports are, also, often in the corporate office, the salesmen's vehicles, their customer visit diaries or filed in lower level management records. If a company can show that they followed up on each and everyone of the complaints and injuries and then attempted to rectify a design defect warning, the effect of a tort action against the corporation would be minimized if those records were documented and available to the plaintiff and court. It is the duty of a manufacturer to encourage its employees and all in the chain of production, distribution and use of the product to report observed hazards, recommend safety improvements, advertise newly discovered dangers, and search for product risks. Failing to search for, collect data and report dangers is a failure of due care.

"Warning: May Be Too Much Of A Good Thing"

John M. Broder's article on the above topic was published in The New York Times on Wednesday, March 5, 1997. He stated that, "Product makers have reacted-many experts say overreacted- by pasting warnings on every imaginable product, but there is considerable debate over whether to heed the now ubiquitous alarms". He goes on to say that, "Some other experts argue that warnings, properly and compellingly, may be able to help injury. But their prime benefit is in the legal arena".

The above statements indicate that both the consumer and the manufacturer can both benefit by properly placed and worded warnings. A prudent consumer will abide by and follow those warnings in order to protect themselves and others from foreseeable injuries. The manufacturer, on the other hand, will create those effective and properly worded warnings to protect the corporation from any action against them if the product for its foreseeable use as well as its foreseeable misuse.

Commenting on warnings in the same article, Aaron Locker, general counsel to Toy Manufacturers of America stated, "It's become a joke,?regulators say that warning is the least effective way to protect kids; most people don't read the warnings anyway. But this is what we've come to in a highly litigious society which permits litigation like this without restrain". Some years ago, the Toy Manufacturers of America hired this author through Inter-City testing 7 Consulting Corporation to evaluate the design and warnings of a crib in which infants were being strangled. After evaluating the claims, the design and warnings, we informed our client that there were problems with the deign and warnings and that they should do something to eliminate the defects. Instead of doing this, they dispensed with any future work that we were to perform.

Howard W. Younger, senior vice president of Empire Industries was also quoted in Mr. Broder's article. He stated that, "Consumers have some responsibilities, they truly do--not the least of which is to read the warning signs". He further said that company lawyers drew up this warnings based on emergency room records, consumer surveys and past legal history. But he suspects that consumers rarely bother to read them and that manufacturers may even be contributing to their products' misuse by over-warning. What is interesting in this instance is that he used lawyers, not a team of specialists, including a warnings expert, to create effective warnings and instructions.

Commenting on the failure to read warnings and instructions on a label was a recent appellate court case, Johnson vs. Johnson Chemical Co., 183 A.D. 2d64 (N.Y. App. Div. 1992). This case involved two plaintiffs who were injured when insecticide foggers that one of the plaintiff's had activated in her kitchen exploded after the spray came in contact with the stove pilot light. The plaintiffs sued the insecticide maker claiming, among other things, that the warning was inadequate. Despite the plaintiff's admission that she failed to read the alleged inadequate warnings, the court held that such failure "does not necessarily sever the causal connection between the alleged inadequacy of those warnings, on the one hand, and the occurrence of the accident on the other". The court reasoned that the content of the text of a warning is only one factor to be considered in determining the adequacy of the warning, and that a consumer who, by her own admission, tended to ignore one sort of label, might pay heed to a different, more prominent or more dramatic label. "The reasonableness of her behavior is for the jury to decide" the court concluded.

In an Alabama case, E.R. Squibb & Sons, Inc. versus Cox, 477 So. 2d 963 (ALA, 1985) where the plaintiff's injuries resulted from the use of the wrong type of insulin, the state supreme court reversed a jury verdict for the plaintiff. The evidence at trial showed that the plaintiff never read the box containing the insulin he purchased from a drug store or any of the accompanying literature, as he assumed that the box contained the same type of insulin he purchased he had always received. The Alabama court left open the possibility that a plaintiff could survive a summary judgment on an inadequate warning case even where the plaintiff had failed to read the warning: "(We) hold that a plaintiff who does not read an allegedly inadequate warning cannot maintain a negligent-failure-to-adequacy-warn action unless the nature of the alleged inadequacy is such that it prevents him from reading it."

Conversely, an Indiana appeals court found for a plaintiff in a failure to read an allegedly inadequate warning case, Jarrell v. Monsanto Co., 528ME 2d 1158 (IND. Ct. App. 1988), reversing the trial court's entry of summary judgment in favor of the manufacturer. In granting the defendant's motion for summary judgment in the first instance, the trial court found, among other things, that (1) the plaintiff was aware of the warning; (2) the plaintiff had failed to read the warnings; (3) the plaintiff's employer was aware of the warnings and had posted standard operating procedures.

In reversing the trial court, the Indiana appeals court addressed the plaintiff's failure to read warnings, but not as part of its determination on approximate causation; rather, the court addressed it in order to determine whether the manufacturer had established a contributory negligence defense. "(The manufacturer) alleges (the plaintiff's) contributory negligence in failing to read the warning labels on the bags. However, if the label's warnings are inadequate and the labels fail to capture the user's attention, failure to read them does not bar a claim as a matter of law. In the present case, an issue of fact does exist as to the label's attention getting capability)," the court said. The court also rejected the manufacturer's argument that the plaintiff should have blown dust off the bag to search for labels. The court also maintained that the presence of the dust itself suggested that the warning was inadequate in light of the environment.

These cases are reconciled when the court distinguishes between a warning that is inadequate due to its content, and a warning that is inadequate due to form-such as the lack of prominence. This distinction explains to some extent the conflicting outcomes in cases where the plaintiff has failed to read the warning. That is, a warning's inadequacy constitutes the very reason for the plaintiff's failure to read it. Then a causal connection between the warning and the injury still may exist, and a jury question remains to be addressed. One also must take into account that the outcome in cases where there is a plaintiff's failure to read an inadequate warning may vary depending upon jurisdiction.

Conclusion

Based upon manufacturers knowing their own products and the availability of teams of consultants from safety engineers to linguistic and reading specialists, there is no question that manufacturers can protect themselves, as well as consumers from litigation. If manufacturers create a paper trail in the development of safer products, they will minimize or eliminate the effect of any legal action. A warning must at minimum: (1) get the user's attention; (2) describe the danger in vivid terms; (3) give specific instructions on how to avoid injury to the user and others and (4) describe the consequences of not following the warnings and instructions. This will dramatically help in minimizing tort litigation.


Dr. Carl J. Abraham is a Certified Professional Chemical Engineer with over thirty five years of international experience consulting to insurance companies, municipalities, government agencies, and the legal profession. He provides consultation to International corporations in the areas of New Product Development, Manufacturing, Packaging, Warnings and Instructions. Dr Abraham's services include Expert Witness Testimony for both Plaintiff and Defense in matters involving Personal Injury and Product Liability.

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