Supreme Court Evaluates Consumer Expectations Test in Strict Liability Claims
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1 Supreme Court Evaluates Consumer Expectations Test in Strict Liability Claims Armando G. Hernandez, Daily Business Review November 16, 2015 In one of the most highly anticipated opinions in recent memory for products liability practitioners, manufacturers and clients, the Florida Supreme Court finally issued its opinion in Aubin v. Union Carbide on Oct. 29. Aubin involved an asbestos and mesothelioma case tried by a jury, which returned a multimillion dollar verdict in favor of the plaintiff. While at first glance an asbestos case may seem not to have much relevance to other product cases (such as automobiles, recreational products, appliances and so forth), Aubin has mass appeal because it involved tensions between the consumer expectations and risk utility tests, as well as other issues involving causation. The primary focus of this article will be on the consumer expectation and risk utility tests issue. Aubin was on nearly everyone's radar because the Florida Supreme Court approved the product liability instructions March 26, As it had for years, the recently enacted product liability instructions included both the reasonable consumer expectations test, as well as the risk utility standard. Oral arguments in Aubin took place in April As such, the product liability instructions were approved after the Aubin oral arguments but while the decision was still pending. As anticipated, Aubin had a significant impact on the debate between the consumer expectations and risk utility tests. The decision represents the Florida Supreme Court's first pronouncement directly tackling this specific topic since 1976 in West v. Caterpillar Tractor. On the one hand, the consumer expectations test essentially posits that a product is defectively designed if the plaintiff is able to demonstrate that the product did not perform as safely as an ordinary consumer would expect when used in the intended or reasonably foreseeable manner. On the other hand, the risk utility test postulates that a product is unreasonably dangerous because of its design if the risk of danger in the design outweighs the benefits. The Third Restatement also provides that a plaintiff must demonstrate that the foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of a reasonable alternative design. The Aubin court concluded that "the definition of design defect first enunciated in West, which utilizes the consumer expectations test, instead of utilizing the risk utility test and requiring proof of a reasonable alternative design, best vindicates the purposes underlying the doctrine of strict liability." The underlying purpose of strict liability, as the court indicates, is "to relieve injured consumer from the difficulties of proving negligence on the part of the product's manufacturer." The court noted that "by introducing foreseeability of the risk to the manufacturer as part of the calculus for design defect and requiring proof of a 'reasonable alternative design,' the Third Restatement reintroduces principles of negligence into strict liability." In arriving at its holding, the court analyzed and was guided by other state supreme court opinions (i.e. Connecticut, Kansas, Pennsylvania and Wisconsin) that had considered the same question and expressed public policy concerns about the risk utility test as applied to design defects. The court emphasized how the risk utility test "blurs the distinction between
2 strict products liability claims and negligence claims... focus[ing] on the conduct of the manufacturer." In addition, it found that the Third Restatement's risk utility test and alternative design requirement "imposes a higher burden on consumers to prove a design defect than exists in negligence cases the antithesis of adopting strict products liability in the first place." Moreover, the court was persuaded that the consumer expectations tests "intrinsically recognizes that a manufacturer plays a central role in establishing the consumers' expectations for a particular product, which in turn motivates consumers to purchase the product." The court rejected proof of a reasonable alternative design as a required element and declared such an unnecessary and additional burden. The court commented that such a requirement "could insulate a manufacturer from all liability for unreasonably dangerous products solely because a reasonable alternative design for that type of product may be unavailable." It is important to note that the Florida Supreme Court did not reject the risk utility test and reasonable alternative design concept in all regards. The Aubin decision, while seemingly far sweeping, should not be read so broadly. The court commented that the "consumer expectations test does not inherently favor either party." The decision, at a very minimum, holds that the consumer expectations test as enunciated in West Caterpillar and its progeny, as well as the Second Restatement of Torts must be used to define a design defect. However, the decision does not expressly (or even impliedly) reject the risk utility test in other contexts (such as negligence counts, as an affirmative defense, or as an additional standard). Instead, the court explains that a "defendant may present evidence that no reasonable alternative design existed while also arguing in defense that the benefit of the product's design outweighed any risks or injury or death caused by the design." Moreover, in light of the existing product liability instructions recently promulgated by the very same Aubin court, the risk utility test is still relevant and worthy of consideration either in addition to the consumer expectations test or as a defense. The Aubin court expressly noted that the recent product liability instructions use both the consumer expectations and risk utility tests. The Aubin decision indicates nothing that would undermine the giving of both instructions going forward under the appropriate facts. The recent product liability instructions remain standard, binding and enforceable unless and until the Florida Supreme Court Jury Instruction Committee offers a new instruction for the Supreme Court's consideration. The Aubin decision makes clear that proof of a reasonable alternative design is not a requirement or element of plaintiff's burden. But the court clarified "that nothing precludes the plaintiff in proving his or her case from showing that alternative safe designs exist or for that matter precludes the defendant from showing that it could not have made the product any safer through reasonable alternative designs." The court also endorsed the Third Restatement's factors for evaluating an alternative design when at issue, including the magnitude and probability of the foreseeable risks of harm, the instructions and warnings accompanying the product, and the nature and strength of the consumer expectations. Looking forward, as sensational as the Aubin decision may appear, we will have to see if its practical impact lives up to the hype. A few things we know for certain. Going out on a limb to seek a jury instruction only on risk utility will be challenging to say the least. Plaintiffs do not have to proffer or prove a reasonable alternative design exists. There is also much that is left to be determined and litigated. Will things remain essentially status quo with plaintiffs only seeking consumer expectation and defendants seeking risk utility with the end result
3 being a confluence of the two tests? Will trial courts begin to treat risk utility only as a defense? What if no reasonable alternative design is raised, there are no risk-utility contentions, and/or no negligence count is asserted? In any event, practitioners must be mindful of the landmines that lie ahead in interpreting Aubin and carefully crafting jury instructions post-aubin. In the not-so-distant future, the emerging issue on the product liability frontier may be whether with a certain product, design defect, and pertinent manufacturer conduct, there can be a "reasonable consumer expectation" for a specific type of complex product or complex alleged defect. Armando G. Hernandez is an associate in the Miami office of Rumberger, Kirk & Caldwell. He practices in the areas of products liability, casualty defense, commercial litigation and admiralty matters. Read more: 8 Armando G. Hernandez, Daily Business Review November 16, 2015 In one of the most highly anticipated opinions in recent memory for products liability practitioners, manufacturers and clients, the Florida Supreme Court finally issued its opinion in Aubin v. Union Carbide on Oct. 29. Aubin involved an asbestos and mesothelioma case tried by a jury, which returned a multimillion dollar verdict in favor of the plaintiff. While at first glance an asbestos case may seem not to have much relevance to other product cases (such as automobiles, recreational products, appliances and so forth), Aubin has mass appeal because it involved tensions between the consumer expectations and risk utility tests, as well as other issues involving causation. The primary focus of this article will be on the consumer expectation and risk utility tests issue. Aubin was on nearly everyone's radar because the Florida Supreme Court approved the product liability instructions March 26, As it had for years, the recently enacted product liability instructions included both the reasonable consumer expectations test, as well as the risk utility standard. Oral arguments in Aubin took place in April As such, the product liability instructions were approved after the Aubin oral arguments but while the decision was still pending. As anticipated, Aubin had a significant impact on the debate between the consumer expectations and risk utility tests. The decision represents the Florida Supreme Court's first pronouncement directly tackling this specific topic since 1976 in West v. Caterpillar Tractor. On the one hand, the consumer expectations test essentially posits that a product is defectively designed if the plaintiff is able to demonstrate that the product did not perform as safely as an ordinary consumer would expect when used in the intended or reasonably foreseeable manner. On the other hand, the risk utility test postulates that a product is unreasonably dangerous because of its design if the risk of danger in the design outweighs the benefits. The Third Restatement also provides that a plaintiff must demonstrate that the
4 foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of a reasonable alternative design. The Aubin court concluded that "the definition of design defect first enunciated in West, which utilizes the consumer expectations test, instead of utilizing the risk utility test and requiring proof of a reasonable alternative design, best vindicates the purposes underlying the doctrine of strict liability." The underlying purpose of strict liability, as the court indicates, is "to relieve injured consumer from the difficulties of proving negligence on the part of the product's manufacturer." The court noted that "by introducing foreseeability of the risk to the manufacturer as part of the calculus for design defect and requiring proof of a 'reasonable alternative design,' the Third Restatement reintroduces principles of negligence into strict liability." In arriving at its holding, the court analyzed and was guided by other state supreme court opinions (i.e. Connecticut, Kansas, Pennsylvania and Wisconsin) that had considered the same question and expressed public policy concerns about the risk utility test as applied to design defects. The court emphasized how the risk utility test "blurs the distinction between strict products liability claims and negligence claims... focus[ing] on the conduct of the manufacturer." In addition, it found that the Third Restatement's risk utility test and alternative design requirement "imposes a higher burden on consumers to prove a design defect than exists in negligence cases the antithesis of adopting strict products liability in the first place." Moreover, the court was persuaded that the consumer expectations tests "intrinsically recognizes that a manufacturer plays a central role in establishing the consumers' expectations for a particular product, which in turn motivates consumers to purchase the product." The court rejected proof of a reasonable alternative design as a required element and declared such an unnecessary and additional burden. The court commented that such a requirement "could insulate a manufacturer from all liability for unreasonably dangerous products solely because a reasonable alternative design for that type of product may be unavailable." It is important to note that the Florida Supreme Court did not reject the risk utility test and reasonable alternative design concept in all regards. The Aubin decision, while seemingly far sweeping, should not be read so broadly. The court commented that the "consumer expectations test does not inherently favor either party." The decision, at a very minimum, holds that the consumer expectations test as enunciated in West Caterpillar and its progeny, as well as the Second Restatement of Torts must be used to define a design defect. However, the decision does not expressly (or even impliedly) reject the risk utility test in other contexts (such as negligence counts, as an affirmative defense, or as an additional standard). Instead, the court explains that a "defendant may present evidence that no reasonable alternative design existed while also arguing in defense that the benefit of the product's design outweighed any risks or injury or death caused by the design." Moreover, in light of the existing product liability instructions recently promulgated by the very same Aubin court, the risk utility test is still relevant and worthy of consideration either in addition to the consumer expectations test or as a defense. The Aubin court expressly noted that the recent product liability instructions use both the consumer expectations and risk utility tests. The Aubin decision indicates nothing that would undermine the giving of both instructions going forward under the appropriate facts. The recent product liability instructions remain standard, binding and enforceable unless and until the Florida Supreme
5 Court Jury Instruction Committee offers a new instruction for the Supreme Court's consideration. The Aubin decision makes clear that proof of a reasonable alternative design is not a requirement or element of plaintiff's burden. But the court clarified "that nothing precludes the plaintiff in proving his or her case from showing that alternative safe designs exist or for that matter precludes the defendant from showing that it could not have made the product any safer through reasonable alternative designs." The court also endorsed the Third Restatement's factors for evaluating an alternative design when at issue, including the magnitude and probability of the foreseeable risks of harm, the instructions and warnings accompanying the product, and the nature and strength of the consumer expectations. Looking forward, as sensational as the Aubin decision may appear, we will have to see if its practical impact lives up to the hype. A few things we know for certain. Going out on a limb to seek a jury instruction only on risk utility will be challenging to say the least. Plaintiffs do not have to proffer or prove a reasonable alternative design exists. There is also much that is left to be determined and litigated. Will things remain essentially status quo with plaintiffs only seeking consumer expectation and defendants seeking risk utility with the end result being a confluence of the two tests? Will trial courts begin to treat risk utility only as a defense? What if no reasonable alternative design is raised, there are no risk-utility contentions, and/or no negligence count is asserted? In any event, practitioners must be mindful of the landmines that lie ahead in interpreting Aubin and carefully crafting jury instructions post-aubin. In the not-so-distant future, the emerging issue on the product liability frontier may be whether with a certain product, design defect, and pertinent manufacturer conduct, there can be a "reasonable consumer expectation" for a specific type of complex product or complex alleged defect. Armando G. Hernandez is an associate in the Miami office of Rumberger, Kirk & Caldwell. He practices in the areas of products liability, casualty defense, commercial litigation and admiralty matters. Read more: 8
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