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Seven Ways to Avoid Getting Sued for Product Liability

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Holland & Hart LLP attorney Dennis W. Brown shares seven ways for companies to avoid getting sued for product liability or consumer fraud.

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Seven Ways to Avoid Getting Sued for Product Liability

  1. 1. Seven Ways to Avoid Getting Sued for Product Liability PRESENTED BY: DENNIS W. BROWN, ESQ. HOL LAND AND HART, L LC DBROWN@HOL LANDHART.COM
  2. 2. DISCLAIMER • This is Not Legal Advice • There is No Attorney-Client Relationship • No Privilege Exists
  3. 3. Objective of Today’s Talk To help you and your company avoid getting sued for product liability or consumer fraud.
  4. 4. Face Reality…How Juror’s Think
  5. 5. The Danger…How Juror’s Think “I think that the manufacturer has a duty to prove that they have TESTED the equipment…and done everything within their reasonable ability to make it safe. [I]f you can find something that they short cut… that’s negligence in my view.” [emphasis added] Source: Persuasion Strategies 2013 National Juror Survey
  6. 6. Jurors Expect Significant Testing
  7. 7. Who Can Be Sued? • Manufacturer • Component part manufacturer • Distributor • Retailer/Seller • Installer • Owner/Operator • Maintenance/Repair Person
  8. 8. Where Can You Be Sued? State Court – State where product was made – State where product was sold – State where Plaintiff lives – State where product was advertised – State where injury occurred Federal Court – If diversity exists Foreign Country
  9. 9. The Seven Ways to Avoid Getting Sued 1. DESIGN is in accordance with standards 2. MANUFACTURE in accordance with specs 3. WARNINGS, labels & manuals are thorough & clear 4. REPRESENTATIONS must be accurate and truthful 5. COMPLAINTS must be monitored and addressed 6. RECALLS are implemented where appropriate 7. LAWS are followed
  10. 10. Design Specification – Legal Claim Product design is unreasonably dangerous.
  11. 11. Design Defect - Protections Follow the Recognized Safety Hierarchy 1. Design Out the Potential Hazard 2. Guard Against the Potential Hazard 3. Warn About the Potential Hazard
  12. 12. Safety Hierarchy Explained
  13. 13. WARNING – USER AND BYSTANDER ALWAYS WEAR SAFETY GOGGLES • Use only to drive and pull common unhardened nails. Any other use, such as striking this tool with or against another striking tool, nail puller, hardened nail, or other hard object or using a chipped hammer, may cause the hammer to chip, possibly resulting in blindness or other serious injury to the user or bystander. Discard hammer immediately if chipped.
  14. 14. Design Defect – Protections (con’t) • Product design should follow the standards and industry practice
  15. 15. Design Defect – Protections (con’t) • Foreseeable Misuse must be considered • Monitor accidents reported in trade magazines, trade organizations, blogs
  16. 16. Design Defect – Protections (con’t) • Subsequent remedial repairs/changes
  17. 17. Design Defect – Protections (con’t) Lawsuits against outdoor equipment manufacturers alleging design defect – Harness – Helmets – Camp stove
  18. 18. Manufacturing Defect – Legal Claims Product not manufactured in accordance with design or material specifications.
  19. 19. Manufacturing Defect - Protections QA Program
  20. 20. Manufacturing Defect - Protections Quality Vendors
  21. 21. Manufacturing Defect - Protections Record Keeping
  22. 22. Warnings, Labels & Manuals- Legal Claims
  23. 23. Warnings, Labels & Manuals- Claims Hazard should have been designed out or guarded against No warning provided Warning was - insufficient - in wrong location - words not a pictorial - only in English - information overload
  24. 24. Juror Views When Warnings Are Used
  25. 25. Juror Views When Safety Instructions not Followed
  26. 26. Here are some actual labels on consumer goods: • “Do not iron clothes on body” -- Rowenta iron packaging
  27. 27. • “Do not attempt to stop chain with hands” -- Swedish chain saw
  28. 28. Warnings, Labels & Manuals- Protections BE CAREFUL Follow Warnings in Standard Information Overload Words v Symbols Colors Languages Printed Word v. CD
  29. 29. Warnings, Labels & Manuals Lawsuits against outdoor equipment manufacturers or retailers alleging failure to warn: – Rope – Tent – Ski Bindings
  30. 30. False Representations – Legal Claims Advertising or Promotion or Product Literature Contains – Promotions that • are not 100% verifiable • make promises or guarantees • are incorrect
  31. 31. False Representations - Protections Representations must be absolutely verifiable Medical claims universally accepted 100% = 100% Marketing, Engineering + Legal must all work together
  32. 32. Customer Complaints – Legal Claims Defective product Fraud Breach of Warranty Class Actions
  33. 33. Customer Complaints – Protections To Protect Yourself – Go Where the Plaintiff Attorneys Go to Find Their Cases? • Regulatory Investigations • Enforcement Proceedings • Recalls – Create websites “investigating” companies/products • Disgruntled Customers – web postings – Ripoffreport.com
  34. 34. Customer Complaints - Protections Where do Plaintiff Attorneys Find Their Cases? • Your website • Materials supplied with the product • Web search for “complaints regarding ________” (insert company or product name)
  35. 35. Customer Complaints (con’t) Social media & internet postings criticizing outdoor equipment manufacturers – Harness – Ski pole with steel pick – Kayak paddles
  36. 36. Customer Complaints - Protections Effective customer call-in line
  37. 37. Customer Complaints - Protections Monitor and Track Customer Complaints
  38. 38. Customer Complaints - Protections Monitor the CPSC Product Incident Database = http://www.saferproducts.gov
  39. 39. Meaningful and Effective Warranty
  40. 40. Keep an Eye on Social Media and Internet Postings
  41. 41. Customer Complaints – Protections (con’t) Sue the offender: Texas Firm Sues Client For Negative Yelp Review LITIGATION Weekly Alert July 29, 2014
  42. 42. Recalls – Legal Claims • Voluntary recalls • Involuntary recalls
  43. 43. Recalls - Protections Proactive Monitor Your Customer Complaints and Claims Work with the regulatory agencies
  44. 44. Recalls (con’t) Recalls involving outdoor equipment – Camming anchor – Harness – Sea kayak paddle floats – Kayaking helmets
  45. 45. Follow the Law – Legal Claims Product design, manufacture or sale violated the law
  46. 46. Follow the Law - Protections Know and follow the law wherever your product is sold – sounds easy enough
  47. 47. In Closing
  48. 48. Questions
  49. 49. Thank you for attending! PLEASE USE THE OR APP TO RATE THIS SESSION

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