How Do You Defend Your Business Against Product Liability?
Among the costly setbacks a business can face, product liability is one of the most serious. Besides the lengthy, expensive court proceedings, your business might face long-term reputational damage.
By understanding what product liability is, when the law exempts you from it, and the precautions you can take to protect your business, you can better defend against potential product liability claims.
What Is Product Liability?
If someone gets hurt after using a product you sell or manufacture, the victim can sue your business for damages; this litigation is considered product liability.
For example, suppose you are a motor vehicle manufacturer that produces a car with faulty brakes. If an accident is proven to be directly caused by the brakes’ failure, you may be held liable for the crash.
Product liability can also encompass services. For example, if you run a restaurant serving contaminated or undercooked food, you may be responsible for any harm the consumers suffer.
What Are Some Exemptions from Product Liability?
There are instances in which you can distance your company from product liability. Here are some exemptions.
Misuse
If you clearly label your product’s intended use and follow all safety regulations, you should not be held liable for the damage caused after the product’s use. However, the court requires you to prove that the product was not intended to be used as the plaintiff did.
In that case, the court will analyze the manufacturer’s instructions or warnings on the product label and any warnings given to the purchaser to determine the likelihood of misuse.
Modification
The original product was well-labeled with usage directions and warnings. However, a distributor or retailer may modify or install it in a way that fails to meet the necessary safety standards.
Since product modifications can interfere with the safe functioning of a product, you can prove that you were not responsible for the injury or damage caused by such modifications.
Statute of Limitations
Every state has a period when a product liability claim must be brought against your business known as the statute of limitations. You can petition to dismiss the case if the plaintiff has not filed the claim within this period.
However, a plaintiff may claim that they did not discover the defect or the damage caused by the defect until after the statute of limitations had passed.
Assumed Risk
Some products are generally risky and require extra precaution. For example, construction tools and kitchen utensils don’t necessarily need warning labels for users to know how to use them safely.
Holding a knife by its blade or using a hammer without safety glasses are assumed risks to users. If they still get injured with or without warnings, the plaintiff assumed risk, and your business is not liable for the damage.
How Do You Protect Yourself From Liability?
Now that you understand cases in which you may not be responsible for product liability, you must also take some steps to protect your business. Here are some tips:
- Use a warning label on potentially hazardous items.
- Make sure the instructions and product information are clear, simple, and informative.
- Invest in comprehensive product testing and quality assurance.
- Get product liability insurance.
Most importantly, consult a product liability lawyer to help you understand the legal risks and how to protect yourself from a product liability lawsuit. The attorney will also help you collect evidence and documents to help you defend your case.
Mohajerian is your trusted law firm for business litigation and product liability cases. Our attorneys are experienced in handling complex product liability cases, and we know when and how to defend your business against product liability claims. Contact us for a consultation.