Product LIABILITY is the concept that consumers can be compensated for injuries or losses caused by defective or unsafe products. A manufacturer is legally liable if a PRODUCT can be shown to be unreasonably dangerous to the user or consumer, or if it is defective. Product defects can be design defects, manufacturing defects, or marketing defects. A design defect is a problem that makes the product inherently dangerous by nature of a flaw in its design. Manufacturing defects are problems that occur when the product is made in a way that causes it to be unsafe or defective. Marketing defects are failures to provide proper use or installation instructions with the product or to warn the consumer of the dangers of improper use of the product. Product liability was initially limited to the manufacturer, although sellers, WHOLESALERs, distributors, and others in the chain of supply, from manufacturers to consumers, may be held liable for personal injury or damage to PERSONAL PROPERTY in some situations. Generally the losses that can be claimed are limited to those caused by physical injury or property damage. Under modern U.S. product-liability law, a nonuser or bystander who is injured or suffers a loss due to a defective product may seek compensation. The concept “product” has also been broadened from its original meaning of tangible personal property (automobiles, mechanical equipment, or other consumer goods) and now includes intangibles such as water (as water-supply contamination) or real estate. Product-liability litigation has involved such diverse products as asbestos insulation, cigarettes, dietary supplements, breast implants, MTBE (reformulated gasoline products), latex products, handguns, and automobile tires. There are three legal theories that may apply in productsliability law: NEGLIGENCE, WARRANTY, and strict tort liability. Under the negligence theory, a manufacturer has a duty to make its product safe for users and is liable for damage or injuries caused by a product that is negligently or carelessly manufactured. Negligence is failure to make a safe product or to take steps to test a product to ensure that it is properly constructed for its intended use. One example of a negligence case is MacPherson v. Buick Motor Company (1916). MacPherson, the owner of a Buick automobile, sued Buick Motor Company of Detroit for injuries sustained in an automobile accident that resulted from a defective wheel made of inferior-quality wood. The New York Court of Appeals found that the defect could have been discovered by a manufacturer’s inspection and the manufacturer had a duty to ensure the product was safe to be marketed to consumers. Therefore Buick was found liable for MacPherson’s injuries and the damage to his automobile. The warranty theory implies that there are some expectations associated with a product, and the manufacturer or seller can be held liable if the product fails to meet those expectations. Warranties can be implied or express. Implied warranties are the assumption of a certain quality of a product based on the fact that it is being offered for sale—i.e., it is implied to be suitable for the purpose for which it is being sold. Express warranties are specific representations made by the manufacturer or seller about the quality of the product or its fitness for an intended purpose. An example of an express warranty is found in the state of Washington case Baxter v. Ford Motor Company et al. (1932). The windshield of the plaintiff’s car was shattered by a pebble, which resulted in his losing an eye. He sued Ford Motor Company and the car dealer who sold him the car on the grounds that the company had advertised that the windshields on the cars were shatterproof. The Washington state court held that Ford’s marketing statements were an express warranty, and thus the company was liable for failure of its product to perform as expected. Strict tort liability arises if the product is defective and unreasonably dangerous. Under strict liability, the manufacturer, seller, or distributor of a product can be held liable if the product is defective and is unreasonably dangerous to the consumer. A consumer can recover DAMAGES by proving the manufacturer made the product and that it was defective; the plaintiff does not need to prove that the manufacturer knew of the defect or could have prevented it. An example is the California case Greenman v. Yuba Power Products Inc. (1962). The plaintiff sued the manufacturer of a lathe for injuries caused when wood he was working on came loose from the machine and struck him. The basis of his claim against the manufacturer was that information provided with the lathe led him to believe the wood would be securely held when the machine was in use. Since that was not the case, the machine was therefore defective and an unreasonably dangerous product. The court ruled in favor of the plaintiff. As indicated in the cases cited above, product-liability law evolved gradually through COMMON LAW. Also known as case law, common law is comprised of the decisions made by state court judges, while statutory law made by the legislative branch of the government at either the state or federal level. One of the most important cases in the development products-liability law was New York’s MacPherson v. Buick, which opened the door for consumers to sue manufacturers for faulty products. Laws up until that time were based on the concept of CONTRACT privity, which prevented a consumer from suing the manufacturer of a product on the grounds that he had no direct contractual relationship with the manufacturer. This was true of MacPherson, who purchased his automobile from a car dealer and therefore had no direct dealings with Buick Motor Company. However, Judge Benjamin Cardozo held that Buick was liable to its cars’ purchasers if it was shown that the cars were negligently made or not properly inspected after manufacture. The effect of the MacPherson decision was that products liability was no longer limited to a contractual relationship, and it became a part of tort law. Consumers could sue based on a tort, a private wrong, rather than a breach of contract. Consumers’ rights were expanded under later productliability cases. In Baxter v. Ford, the court provided a means for protecting consumers from false ADVERTISING by manufacturers regarding the quality of products being sold. As a result of Greenman v. Yuba, consumers could sue for damages or injuries caused by a defective or inherently dangerous product without having to prove the defect or danger was intentional or known by the manufacturer. The importance of CONSUMER PROTECTION and manufacturer responsibilities was further delineated in the California case Grimshaw v. Ford Motor Company, et al. (1981). Ford had manufactured a 1972 Pinto hatchback in which the gas tank was located behind the car’s rear axle. It thus lacked additional “crush space” between the gas tank and the rear bumper or structural reinforcements for the gas tank that aid in withstanding impact during an accident. In the events leading to Grimshaw, a Pinto was struck from behind and burst into flames, resulting in the death of the driver and her young passenger. Ford was held liable on the grounds that the car was defective and unreasonably dangerous. However, this landmark case was especially notable because it involved punitive damages against the manufacturer. Because Pintos had failed standard safety tests performed prior to going on the market, Ford knew it was selling an unsafe product, and the court awarded the plaintiff punitive damages, an additional sum Ford had to pay as punishment for knowingly selling a dangerous product. The combined effect of these key cases was the establishment a body of law that provides a method for consumers to be compensated for injuries or loss caused by defective products and at the same time gives businesses an incentive to design, produce, and sell products that are reasonably safe for the public. Although this has resulted in higher design and production costs that are not faced by companies in other countries lacking product-liability laws, product quality and consumer safety have been improved in the United States. All American states have some form of product-liability law, and many have product-liability statutes. In addition to the common law of each state, product-liability law is also found in Article 2 of the UNIFORM COMMERCIAL CODE (UCC), which covers warranties and consumer rights and has been adopted in all states except Louisiana. While there is no federal product-liability law, and laws can vary considerably from one state to another, the U.S. Department of Commerce has established a Model Uniform Products Liability Act that states can use voluntarily. Attempts to make product-liability laws more uniform from state to state have been occurring in two areas. One key issue under current consideration is the extent to which consumers can recover for losses or injuries. Many businesses are concerned by the increase in product-liability litigation and the ease with which consumers can sue manmanufacturers and others. The effect of numerous lawsuits and dubious or fraudulent claims by some consumers has placed a financial burden on businesses and overloaded the courts. As a result, proposals are being considered by some states and the U.S. Congress to place limits on the amount of compensation that can be claimed by the injured parties in product-liability cases. In the wake of recent lawsuits for products such as dietary supplements and recalled car tires, the imposition of criminal penalties against manufacturers who knowingly allow defective products to be sold or to remain on the market is a second matter being considered by Congress. Both of these proposals are attempts to balance the protection of consumer rights with businesses’ ability to develop new products and remain commercially competitive. Laurie MacWhinnie