In Pennsylvania: Product Liability Law Post-<i>Tincher</i>

In a sweeping, detailed opinion, the Pennsylvania Supreme Court altered the landscape of Pennsylvania product liability law, reaching back in time to embrace and then update legal principles governing a consumer's burden of proof in recovering for harm caused by a defectively designed product.

Stated in general terms, the decision in Tincher v. Omega Flex, 2014 Pa. LEXIS 3031, overruled the language of the court's opinion in Azzarello v. Black Brothers, 480 Pa. 547, 391 A.2d 1020 (1978), and its progeny, replacing that definition of a defective condition with two independent analyses: consumer-expectation and risk-benefit tests. Further, the court emphatically rejected adoption of the Restatement (Third) of Torts, ending a disagreement between state and federal courts (which had wrongly predicted that Pennsylvania would adopt the Third Restatement). Explaining that, stare decisis aside, the Tincher court said that “precedent, of course, is not infallible; if we are to ensure both the perception and the reality of justice, we must be willing to reexamine precedent if it is demonstrated that a prior rule does not serve, or no longer adequately serves, the interests of justice.”

The Primary Rulings

The Tincher court held that:

• Azzarello and its progeny defining the standard by which a product may be judged defectively designed are overruled.
• A plaintiff may prove a product was designed in a defective condition by showing either that the danger is unknowable and unacceptable to the average or ordinary consumer, or that a reasonable person would conclude that the probability and seriousness of harm caused by the product outweigh the burden or costs of taking precautions.
• The question of whether a product is in a defective condition is for the fact-finder, not the trial court, to resolve, unless reasonable minds would not differ on this question'removing from the proceedings the Azzarello pretrial issue that allowed the court to decide the policy question of whether a product is “legally” unreasonably dangerous.
• The ruling rejected the legal principles defining product liability set forth in the Third Restatement, which in major part requires that the plaintiff prove an alternative design.

Despite announcing sweeping changes to the foundational principles governing a supplier's duty to market a non-defective product, the court retained the distinctions between strict liability and negligence claims, stating:

The tortious conduct at issue is not the same as that found in traditional claims of negligence and commonly associated with the more colloquial notion of 'fault.' In this sense, introducing a colloquial notion of 'fault' into the conversation relating to strict products liability in tort detracts from the precision required to keep this legal proposition within rational bounds.

These observations then led the court to adopt two alternative legal tests, stating that the plaintiff's injury is compensable when either test is met.

Consumer-Expectation Test

The consumer-expectation test (CET) defines a “defective condition” as one that arises during normal use that is dangerous beyond the reasonable consumer's contemplation. The CET is generally described as whether or not the product's alleged defective condition involves a danger that is unacceptable to the ordinary or average consumer. Stated otherwise, a product is defective if it failed to perform as safely as an ordinary consumer would expect. In gauging whether a product's challenged condition is defective, it is germane to consider: 1) the nature of the product; 2) the identity of the user; 3) the product's intended use and intended user; and 4) any express or implied representations by a manufacturer or seller relevant to assess the consumer's expectations.

To that end, “the commercial advertising of a product will be the guiding force upon the expectations of consumers with regard to the safety of the product, and is highly relevant to a formulation of what those expectations might be,” as the court held in Leichtamer v. American Motors, 424 N.E.2d 568, 578 (Ohio, 1981).

Risk-Benefit Test

The court also acknowledged and decided that since there are some situations when the defective condition is premised on either an obvious danger or a danger outside the contemplation of the ordinary consumer, another legal test may be appropriate to judge the “reasonableness of the danger.” The risk-benefit test (RBT) considers a product defective if a “reasonable person” would conclude that the probability and seriousness of harm caused by the product outweigh the burden or costs of taking precautions. This analysis accounts for the manufacturer's need to adopt precautions proportionate to the magnitude of the expected risk.

The court points out the RBT is a post hoc opportunity to decide whether a manufacturer's conduct in manufacturing or designing a product was reasonable. This analysis is known as the hindsight test. Courts applying the hindsight test ' which furthers Pennsylvania's public policy of holding manufacturers responsible for safety over profits ' note that a product is judged not by the conduct of the manufacturer or designer, but rather by the quality of the end result; the product is the focus of the inquiry. The quality of the product is measured not only by the information available to the manufacturer at the time of design, but also by the information available to the trier of fact at the time of trial. That test is articulated as follows: “'whether a reasonable manufacturer would continue to market his product in the same condition as he sold it to the plaintiff with knowledge of the potential dangerous consequences the trial just revealed,'” as in Dart v. Wiebe Manufacturing, 709 P.2d 876 (Az. 1985). And, commenting upon one element often associated with the RBT, the court said that it would be a mistake to require evidence in all cases of an alternative design because “neither courts, nor the American Law Institute for that matter, are in the business of articulating general principles tailored to anoint special 'winners' and 'losers' among those who engage in the same type of conduct. In our view, the question of 'special tort-insulated status' for certain suppliers ' for example, manufacturers of innovative products with no comparable alternative design ' optimally 'requires an assessment and balancing of policies best left to the General Assembly.'”

What Have We Learned?

As is so often the case, analyzing this decision is fraught with challenges because a substantial portion of the opinion merely recounts the countervailing arguments of the parties and not the principled predicate for the court's decisions. And, as [Pennsylvania] Chief Justice Ronald D. Castille observed, this decision cannot be read expansively beyond the general principles announced. Rather, the court expects that any further changes in the law will be developed “incrementally, as we provide reasoned explications of principles pertinent to factual circumstances of the cases that come before the court.”

How Will Courts Consider Decades of Law?

With Azzarello overruled and the adoption of two new legal standards for judging whether or not a product is defective in design, litigants and courts are left to wage legal war over a host of issues. Here are but a few to consider:

• Does Pennsylvania permit the jury to hear and decide whether or not a product is “unreasonably dangerous”? Does introduction of this phrase depend upon whether the plaintiff proceeds per the CET or the RBT?
• Does Pennsylvania still consider the product manufacturer the guarantor of the product's safety or should the defendant's duty be characterized as the court in Tincher held, per the Restatement (Second) of Torts:

[A] seller, by marketing his product for use and consumption, has undertaken and assumed a special responsibility toward any member of the consuming public who may be injured by it; that public has a right to and does expect, in [the] case of products which it needs and for which it is forced to rely upon the seller, that reputable sellers will stand behind their goods; that public policy demands that the burden of accidental injuries caused by products intended for consumption be placed upon those who market them, and be treated as a cost of production against which liability insurance can be obtained; and that a consumer of such products is entitled to the maximum of protection at the hands of someone, and proper persons to afford it are those who market the products.

Stated affirmatively, a person or entity engaged in the business of selling a product has a duty to make or market the product ' which “is expected to and does reach the user or consumer without substantial change in the condition in which it is sold” ' free from “a defective condition unreasonably dangerous to the consumer or [the consumer's] property.”

• Are there any limits to the application of the CET? In other words, are there any products that should not be judged by this legal standard? If so, how is that decided? Can a trial court refuse to allow a party to present his or her case per the CET? How can a court exclude the application of the CET in light of the proposition established in Tincher that the plaintiff is entitled to choose which theory of liability to submit for jury resolution?
• What are the appropriate jury instructions defining the CET? What are the parties' respective burdens of proof? What are the relevant defenses to such a claim?
• Under what circumstances can a plaintiff proceed with dual theories ' CET and RBT? Would a jury verdict finding liability on one theory and not the other be considered inconsistent?
• Under the RBT, what are the relevant legal and factual defenses?
• Are the manufacturers of unsafe drugs now subject to strict liability independent of Comment K of the Second Restatement?

These questions, and many others, will need to be answered in the next wave of product liability cases that will be litigated over the next several years. In a continuing review of the law, we will provide suggested answers to some of the more perplexing aspects of this dynamic process.

Larry E. Coben , Sol H. Weiss and James R. Ronca are shareholders of Anapol Schwartz who have litigated hundreds of product liability cases for catastrophically injured clients. This article also appeared in The Legal Intelligencer, an ALM sister publication of this newsletter.

In a sweeping, detailed opinion, the Pennsylvania Supreme Court altered the landscape of Pennsylvania product liability law, reaching back in time to embrace and then update legal principles governing a consumer's burden of proof in recovering for harm caused by a defectively designed product.

Stated in general terms, the decision in Tincher v. Omega Flex, 2014 Pa. LEXIS 3031, overruled the language of the court's opinion in Azzarello v. Black Brothers , 480 Pa. 547, 391 A.2d 1020 (1978), and its progeny, replacing that definition of a defective condition with two independent analyses: consumer-expectation and risk-benefit tests. Further, the court emphatically rejected adoption of the Restatement (Third) of Torts, ending a disagreement between state and federal courts (which had wrongly predicted that Pennsylvania would adopt the Third Restatement). Explaining that, stare decisis aside, the Tincher court said that “precedent, of course, is not infallible; if we are to ensure both the perception and the reality of justice, we must be willing to reexamine precedent if it is demonstrated that a prior rule does not serve, or no longer adequately serves, the interests of justice.”

The Primary Rulings

The Tincher court held that:

• Azzarello and its progeny defining the standard by which a product may be judged defectively designed are overruled.
• A plaintiff may prove a product was designed in a defective condition by showing either that the danger is unknowable and unacceptable to the average or ordinary consumer, or that a reasonable person would conclude that the probability and seriousness of harm caused by the product outweigh the burden or costs of taking precautions.
• The question of whether a product is in a defective condition is for the fact-finder, not the trial court, to resolve, unless reasonable minds would not differ on this question'removing from the proceedings the Azzarello pretrial issue that allowed the court to decide the policy question of whether a product is “legally” unreasonably dangerous.
• The ruling rejected the legal principles defining product liability set forth in the Third Restatement, which in major part requires that the plaintiff prove an alternative design.

Despite announcing sweeping changes to the foundational principles governing a supplier's duty to market a non-defective product, the court retained the distinctions between strict liability and negligence claims, stating:

The tortious conduct at issue is not the same as that found in traditional claims of negligence and commonly associated with the more colloquial notion of 'fault.' In this sense, introducing a colloquial notion of 'fault' into the conversation relating to strict products liability in tort detracts from the precision required to keep this legal proposition within rational bounds.

These observations then led the court to adopt two alternative legal tests, stating that the plaintiff's injury is compensable when either test is met.

Consumer-Expectation Test

The consumer-expectation test (CET) defines a “defective condition” as one that arises during normal use that is dangerous beyond the reasonable consumer's contemplation. The CET is generally described as whether or not the product's alleged defective condition involves a danger that is unacceptable to the ordinary or average consumer. Stated otherwise, a product is defective if it failed to perform as safely as an ordinary consumer would expect. In gauging whether a product's challenged condition is defective, it is germane to consider: 1) the nature of the product; 2) the identity of the user; 3) the product's intended use and intended user; and 4) any express or implied representations by a manufacturer or seller relevant to assess the consumer's expectations.

To that end, “the commercial advertising of a product will be the guiding force upon the expectations of consumers with regard to the safety of the product, and is highly relevant to a formulation of what those expectations might be,” as the court held in Leichtamer v. American Motors , 424 N.E.2d 568, 578 (Ohio, 1981).

Risk-Benefit Test

The court also acknowledged and decided that since there are some situations when the defective condition is premised on either an obvious danger or a danger outside the contemplation of the ordinary consumer, another legal test may be appropriate to judge the “reasonableness of the danger.” The risk-benefit test (RBT) considers a product defective if a “reasonable person” would conclude that the probability and seriousness of harm caused by the product outweigh the burden or costs of taking precautions. This analysis accounts for the manufacturer's need to adopt precautions proportionate to the magnitude of the expected risk.

The court points out the RBT is a post hoc opportunity to decide whether a manufacturer's conduct in manufacturing or designing a product was reasonable. This analysis is known as the hindsight test. Courts applying the hindsight test ' which furthers Pennsylvania's public policy of holding manufacturers responsible for safety over profits ' note that a product is judged not by the conduct of the manufacturer or designer, but rather by the quality of the end result; the product is the focus of the inquiry. The quality of the product is measured not only by the information available to the manufacturer at the time of design, but also by the information available to the trier of fact at the time of trial. That test is articulated as follows: “'whether a reasonable manufacturer would continue to market his product in the same condition as he sold it to the plaintiff with knowledge of the potential dangerous consequences the trial just revealed,'” as in Dart v. Wiebe Manufacturing , 709 P.2d 876 (Az. 1985). And, commenting upon one element often associated with the RBT, the court said that it would be a mistake to require evidence in all cases of an alternative design because “neither courts, nor the American Law Institute for that matter, are in the business of articulating general principles tailored to anoint special 'winners' and 'losers' among those who engage in the same type of conduct. In our view, the question of 'special tort-insulated status' for certain suppliers ' for example, manufacturers of innovative products with no comparable alternative design ' optimally 'requires an assessment and balancing of policies best left to the General Assembly.'”

What Have We Learned?

As is so often the case, analyzing this decision is fraught with challenges because a substantial portion of the opinion merely recounts the countervailing arguments of the parties and not the principled predicate for the court's decisions. And, as [Pennsylvania] Chief Justice Ronald D. Castille observed, this decision cannot be read expansively beyond the general principles announced. Rather, the court expects that any further changes in the law will be developed “incrementally, as we provide reasoned explications of principles pertinent to factual circumstances of the cases that come before the court.”

How Will Courts Consider Decades of Law?

With Azzarello overruled and the adoption of two new legal standards for judging whether or not a product is defective in design, litigants and courts are left to wage legal war over a host of issues. Here are but a few to consider:

• Does Pennsylvania permit the jury to hear and decide whether or not a product is “unreasonably dangerous”? Does introduction of this phrase depend upon whether the plaintiff proceeds per the CET or the RBT?
• Does Pennsylvania still consider the product manufacturer the guarantor of the product's safety or should the defendant's duty be characterized as the court in Tincher held, per the Restatement (Second) of Torts:

[A] seller, by marketing his product for use and consumption, has undertaken and assumed a special responsibility toward any member of the consuming public who may be injured by it; that public has a right to and does expect, in [the] case of products which it needs and for which it is forced to rely upon the seller, that reputable sellers will stand behind their goods; that public policy demands that the burden of accidental injuries caused by products intended for consumption be placed upon those who market them, and be treated as a cost of production against which liability insurance can be obtained; and that a consumer of such products is entitled to the maximum of protection at the hands of someone, and proper persons to afford it are those who market the products.

Stated affirmatively, a person or entity engaged in the business of selling a product has a duty to make or market the product ' which “is expected to and does reach the user or consumer without substantial change in the condition in which it is sold” ' free from “a defective condition unreasonably dangerous to the consumer or [the consumer's] property.”

• Are there any limits to the application of the CET? In other words, are there any products that should not be judged by this legal standard? If so, how is that decided? Can a trial court refuse to allow a party to present his or her case per the CET? How can a court exclude the application of the CET in light of the proposition established in Tincher that the plaintiff is entitled to choose which theory of liability to submit for jury resolution?
• What are the appropriate jury instructions defining the CET? What are the parties' respective burdens of proof? What are the relevant defenses to such a claim?
• Under what circumstances can a plaintiff proceed with dual theories ' CET and RBT? Would a jury verdict finding liability on one theory and not the other be considered inconsistent?
• Under the RBT, what are the relevant legal and factual defenses?
• Are the manufacturers of unsafe drugs now subject to strict liability independent of Comment K of the Second Restatement?

These questions, and many others, will need to be answered in the next wave of product liability cases that will be litigated over the next several years. In a continuing review of the law, we will provide suggested answers to some of the more perplexing aspects of this dynamic process.

Larry E. Coben , Sol H. Weiss and James R. Ronca are shareholders of Anapol Schwartz who have litigated hundreds of product liability cases for catastrophically injured clients. This article also appeared in The Legal Intelligencer, an ALM sister publication of this newsletter.