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A New Product Liability Paradigm

March 1, 2015

Key Points:

  • Azzarello overruled.
  • Third Restatement rejected.
  • Pennsylvania product liability law destined for years of uncertainty.

 

After years of waiting, the Pennsylvania Supreme Court finally decided in November 2014 what the product liability law in Pennsylvania would look like. In Tincher v. Omega Flex, the issue was straightforward —would Pennsylvania adopt the Third Restatement of Torts as it relates to product liability claims? Most seasoned veterans and other observers predicted the Third Restatement would be adopted. Indeed, the Third Circuit Court of Appeals had predicted so, and Chief Justice Castille and current Chief Justice Saylor had advocated for its adoption in several earlier dissenting opinions. To the surprise of nearly everyone, in a 4-2 decision, the Supreme Court specifically rejected adoption of the Third Restatement.

The factual background of Tincher is relatively unimportant. It involved a house fire caused by a lightning strike and allegations regarding the proper design of natural gas piping to a home fireplace. Importantly, the plaintiffs argued for a jury charge based on Azzarello v. Black Bros. Co. (Pa. 1978), which had become the bane of defendants’ existence since 1978. Interpreting §402A of the Second Restatement of Torts, Azzarello stood for two essential propositions. First, it imposed a strict dichotomy between negligence and strict liability principles. The jury was to receive no evidence and be given no charge that evoked the “reasonableness” of the defendant’s conduct, even though §402A itself spoke in terms of an “unreasonably dangerous” product. Whether a product was “unreasonably” dangerous was for the court to decide, as a matter of law, often using evidence that would not have been admissible before a jury. This created a cumbersome, difficult-to-comprehend, two-step process. That dichotomy also led to evidentiary rulings that most defendants saw as bizarre, e.g., they cannot defend against allegations that their products are unsafe by showing that they complied with government or industry standards or that they complied with the state of the art for such products at the time of manufacture.

The second impact of Azzarello was the jury charge it imposed, over defendants’ objections.

The [manufacturer] of a product is liable for the injuries caused to the plaintiff by a defect in the product, which existed when the product left the possession of the [manufacturer]. Such liability is imposed even if the [manufacturer] has taken all possible care in the preparation and sale of the product.

The [manufacturer] of a product is the guarantor of its safety. The product must be provided with every element necessary to make it safe for its intended use, and without any condition that makes it unsafe for its intended use. If you find that the product, at the time it left the defendant’s control, lacked any element necessary to make it safe for its intended use, or contained any condition that made it unsafe for its intended use, then the product was defective and the defendant is liable for all harm caused by the defect.

The Third Restatement, on the other hand, is generally considered more defense friendly. It embraces the notion of comparative fault in a strict liability case and the admission of evidence of industry standards and the state of the art.

Plaintiffs have rejoiced at the rejection of the Third Restatement. But in the process, they also lost Azzarello—which the Tincher court specifically overruled. The problem now, and for the foreseeable future, is what has replaced Azzarello, if not the Third Restatement. The answer—confusion.

The Supreme Court retained the principles of §402A of the Second Restatement of Torts, even while rejecting the Azzarello approach. It proclaimed that a plaintiff now may present a strict liability case in two ways:

(1) Consumer Expectation test, where the danger is unknowable and unacceptable for the average or ordinary consumer; or

(2) the Risk Utility test, where a reasonable person would conclude the probability and seriousness of harm caused by the product outweigh the burden or costs of taking precautions.   

Some factors considered in the risk utility test, although not specifically adopted by the Tincher court, are:

(1) the usefulness and desirability of the product—its utility to the user and to the public as a whole;

(2) the safety aspects of the product—the likelihood that it will cause injury, and the     probable seriousness of the injury;

(3) the availability of a substitute product which would meet the same need and not be as unsafe;

(4) the manufacturer’s ability to eliminate the unsafe character of the product without impairing its usefulness or making it too expensive to maintain its utility;

(5) the user’s ability to avoid danger by the exercise of care and the use of the product;

(6) the user’s anticipated awareness of the dangers inherent in the product and their availability, because of general public knowledge of the obvious condition of the product, or of the existence of suitable warnings or instructions; and

(7) the feasibility, on the part of the manufacturer, of spreading the loss by setting the price of the product or carrying liability insurance.

The Supreme Court rejected the Third Restatement in part because it was too specific. In acting with judicial “modesty” and suggesting that such specificity should be left to the legislature, it refused to provide a specific framework for how the parties should present a strict liability case or how the court should try it. Note current Chief Justice Saylor’s dissent advocating just such a framework and its existence in the Third Restatement.

The plaintiff is the master of his/her case and may choose either test or both. But the plaintiff makes such a choice at his/her peril. For example, the consumer expectation test may not apply in products where the danger is obvious or where the product is complex, leading to the risks of arbitrary application of the test. The Tincher court was influenced by many factors, including prior cases, commentators, restatements and case law from other jurisdictions. It was careful to say that it adopted none of them. However, although this analysis is brand new in Pennsylvania, its clearest analog is California.

The Tincher court was specific in its decision that the law should be shaped by advocacy, not by dogmatically following pronouncements, such as the Third Restatement or Azzarello. As a result, there are no longer any valid, recognized instructions to guide juries in determining whether products are defective. There are no specific rules for the admissibility of evidence. Those issues will need to be developed on a case-by-case basis, just as the court envisioned.

We cannot answer many of the questions that arise from Tincher because the Supreme Court did not answer them. For example, does Tincher open the door for certain negligence-based defenses previously prohibited, such as comparative fault by plaintiffs (see, e.g., risk utility factor #5), admission of industry standards and state of the art? What evidence will be admissible? How will the jury be charged?

These questions will exist not only at trial but in the practice from the first day the defense is assigned to counsel. Does Tincher require new defenses to be pled with the answer to the complaint? What additional written discovery should we include? What additional deposition questions do we need to pursue? Should we investigate the plaintiffs’ particular informational environment to understand the basis for any “expectations?” How and when should we object to pursuit of the consumer expectation test if improper? Should we continue to assert adoption of the Third Restatement in our pleadings and at trial?

As to retroactivity of this opinion, the court ruled that Omega Flex had properly preserved the selection of law issues and was entitled to the benefit of Azzarello’s overruling. Thus, it appears the defense should assert the retroactive application of the decision to the extent it overrules Azzarello.

Trial attorneys, trial courts and lower appellate courts will be dealing with the fallout from Tincher for years as Pennsylvania’s product liability law enters a new period of uncertainty. Marshall Dennehey stands ready to help. Please contact us with any questions.

*Keith is a shareholder and Chair of the Product Liability Practice Group. He can be reached at 215.575.2640 and kdheinold@mdwcg.com. John is a shareholder and Chair of the Appellate Advocacy and Post-Trial Practice Group. John can be reached at 215.575.2609 and jjhare@mdwcg.com.

Defense Digest, Vol. 21, No. 1, March 2015

Defense Digest is prepared by Marshall Dennehey Warner Coleman & Goggin to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. Copyright © 2015 Marshall Dennehey Warner Coleman & Goggin, all rights reserved. This article may not be reprinted without the express written permission of our firm.

Affiliated Attorney

Keith D. Heinold
Chair, Product Liability Practice Group
(215) 575-2640
kdheinold@mdwcg.com
John J. Hare
Chair, Appellate Advocacy and Post-Trial Practice
(215) 575-2609
jjhare@mdwcg.com

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