Notice & Comment

Fortieth Anniversary: The Commerce Department’s Foray Into Re-Writing Products Liability Law

On October 31, 1979, forty years ago this week, the Department of Commerce published its Model Uniform Products Liability Act (now commonly referenced as the “Uniform Product Liability Act”) in the Federal Register, 44 Fed. Reg. 62714 (1979).  “The Commerce Department?,” you might respond with bemusement.  Ordinarily uniform and model state laws are crafted by the National Commission on Uniform State Laws, not a federal executive department.  And, of course, the American Law Institute produces restatements of various areas of the law, including  tort law.

The 1960s and 1970s were decades of tumult in products liability law.  Courts were transforming a negligence regime into a strict liability regime based on product “defect” rather than manufacturers’ or retailers’ “fault.”  State jurists sought to extirpate from strict products liability several concepts grounded in negligence or fault-based liability.  This effort had implications both in terms of the definition of “defect” on which manufacturers’ and retailers’ liability for injury-causing products was based, and the defenses they could raise based on the consumer’s conduct.  So, for instance, manufacturers had to anticipate and design against (or at least warn about) some conceivable, but odd, product misuses.[1]  Manufacturers also had to design products that would not be judged solely by a risk/utility test (but also on consumer expectations), and deal with some state courts’ rejection of a “state of the art defense.”

By the mid-1970’s companies began complaining to the Small Business Administration about products liability insurance premiums.  Business’ inability to obtain such insurance at affordable rates had clear implications for the national economy, particularly given the alarming conjunction of unemployment and significant inflation (“stagflation”).  Such stagflation had been brought on, in part, by the dramatic increase in oil prices resulting from concerted action by the Organization of Petroleum Exporting Countries (“OPEC”).[2]  Through most of the decade there were also concerns about diminished productivity.[3]

In response to complaints about a products liability crisis, the federal government quickly formed an interagency task force, chaired by Law Professor Victor E. Schwartz, to study the problem.[4]  The Task Force released an extensive report on November 1, 1977.[5]  It found that the claims regarding the affordability of product liability insurance exaggerated, but concluded that there were several factors affecting products liability insurance preimiums, among them the instability of products liability law.[6]  U.S. Department of Commerce, Interagency Task Force of Products Liability, Final Report.  Two chapters of the report focused on the substantive law of tort liability.  Chapter II contained a detailed discussion of the evolving products liability law doctrines.  Chapter VII discussed remedial approaches to address several problematic aspects of product liability law.  Two notable suggestions offered by the report were establishing a regulatory compliance defense and statutes of repose.

The Department of Commerce developed an options paper setting forth particular courses of action.  With respect to the disarray in substantive products liability law, it discussed three options: (1) leaving the further development of products liability law entirely to the states, (2) drafting a model law that the Commerce Department could encourage states to adopt, or (3) drafting a federal law.  Department of Commerce, Options Paper On Product Liability And Accident Compensation Issues, 43 Fed. Reg. 14612, 14616-17 (April 6, 1978).  After receiving an extensive array of comments, 43 Fed. Reg.  40438 (September 11, 1978), the Commerce Department opted for producing a model law.

On January 12, 1979, Commerce’s “Draft Uniform Product Liability Law” was published in the Federal Register for public comment.  44 Fed. Reg. 2996 (Jan. 12, 1979).  After reviewing approximately 1500 pages of comments, the Commerce Department produced the Uniform Products Liability Act.  See 44 Fed. Reg. at 62714 (UPLA Preamble).

The Uniform Act provides for a modest regulatory compliance defense.  UPLA §108(A).  In general, if the allegedly-defective aspect of a product complied with legislative or regulatory requirements regarding design or performance when sold, the product is not defective.  However, the regulatory compliance defense would fail if the claimant could prove that a reasonably prudent product seller would and could have taken additional precautions.  Id.

Under the Uniform Act, product sellers are not subject to liability for harms that arise after the product’s “useful safe life” has expired.  UPLA §110.[7]  The “useful safe life” “begins at the time of delivery of the product and extends for the time during which the product would normally be likely to perform or be stored in a safe manner.”  UPLA §110(A)(1).  Several aspects of the product and its marketing are relevant to making such a determination, including: (a) the amount of product wear and tear, (b) the “effect[s] of deterioration from natural causes, and from climate and other conditions,” (c) the circumstances, frequency, and purposes of the product’s use, and “normal” expectations with respect to repairs, renewals, and replacements, (4) product seller representations regarding the use of the product and its useful life, and (5) user or third-party alteration of product.  Id.  However, the Uniform Law established a presumption that a product’s “useful safe life” does not exceed 10 years.  UPLA §110(B)(1).  And the presumption could be rebutted only by “clear and convincing evidence.”  Id.

Much of the history of the four-year effort set forth above, as well as an explanation of some of the Uniform Act’s major provisions, appears in Victor E. Schwartz, The Uniform Product Liability Act–A Brief Overview, 33 VAND. L. REV. 579, 592 (1980).  A very concise history of the Uniform Product Liability Act is provided in the Preamble to the version of the Uniform Act printed in the Federal Register.

At the time the UPLA was promulgated, several bills were introduced to enact the UPLA as federal law.  See, e.g., H.R. 1676, 96th Cong., 1st Sess. (unenacted). An interesting hybrid federal-state proposal was introduced around the same time, H.R. 1675, 96th Cong., 1st Sess. (unenacted), the “Standards For State Product Liability Tort Litigation Act.”  See, HEARINGS ON HR 5571, at 42-62 (link and full citation in footnote 6).  The Act would have established a five-member Standards for Product Liability Tort Law Review Panel within the Department of Commerce.  Id. at §201.  The Panel would review state governors’ certifications that the products liability law in their state was consistent with the substantive standards for products liability actions set forth in the federal statute.  Id. at §202.  Though hearings were held on the proposals, as well as other bills to address the products liability insurance crisis, HEARINGS ON HR 5571, Congress did not establish a general federal law of products liability.

The Reagan Administration revisited the products liability areas in the mid 1980’s The Tort Policy Working Group, consisting of representatives of ten federal agencies and the White House produced a report entitled “Report of the Tort Policy Working Group on the Causes, Extent and Policy Implications of the Current Crisis of Insurance Availability and Affordability,” making recommendations that mostly focused on damages issues.  However, the report also reiterated that some elements of “fault-based” liability should remain as a part of strict products liability, including the “state of the arts” defense and “defenses” based on unreasonable consumer conduct.  Id. at 61-62.  (For a chronicle of federal efforts regarding strict products liability after 1979, see Congressional Research Service, Products Liability: A Legal Overview (January 28, 2014) and Congressional Research Service, Products Liability: A Legal Overview (June 3, 2005).)

The UPLA does not appear to have been widely adopted in its entirety in the states, although some states appear to have incorporated some of its provisions into their own law.  See, RICHARD E. KAYE, THE AMERICAN LAW OF PRODUCTS LIABILITY 3d §39.14 (available on westlaw)(discussing three states’ adoption of the MUPLA’s “useful safe life” provision).  (The UPLA does appear to have influenced the of the American Legislative Exchange Council’s Model Product Liability Act (“Model PLA”) of 1995.  ALEC claims that several states revised their products liability law based on its Model PLA.  ALEC, Products Liability Act.)

The Restatement (Third) Products Liability, released January 12, 1998, ultimately seems to have rarely cited the UPLA in setting forth its restatement of the law of products liability.  The number of case citations to the UPLA are also relatively modest.[8]

I hope to produce a more extensive blog post on the UPLA at a later date.

[1] A prominent example is Moran v. Fabergé, 273 Md. 538, 332 A.2d 11 (1975). Two teens sought to use perfume, which was flammable, to scent a lighted candle.  Fabergé was held liable for failing to warn consumers that its perfume should not be used to scent the candles in such a manner.

[2] Readers who are old enough will remember “WIN” buttons, representing the phrase “Whip Inflation Now.”  Younger readers may be amused by the effort to control inflation by exhortation.

[3] For a discussion of the federal government’s efforts to increase productivity, see Statement Of Elmer B. Staats Comptroller General Of The United States, testimony before the Subcommittee on Economic Stabilization of the House Committee on Banking, Finance, and Urban Affairs (July 29, 1980).

[4] The Task Force was composed of representatives from the Council of Economic Advisors, the Office of Management & Budget, the Department of Housing and Urban Development, the Department of Health, Education, and Welfare, the Small Business Administration, the Department of Transportation, the Department of the Treasury, the Department of Labor, the Consumer Product Safety Commission, and the Department of Justice.

[5] Preamble of Model Uniform Products Liability Act, at 44 Fed. Reg. at 62714

[6] Schwartz would later observe in testimony before a House Committee: “As long as courts can retroactively create new and unprecedented product liability law, the spectre of future product liability crises will continue.  Statutory uniformity in product liability can stabilize product liability insurance ratemaking and serve as a bulwark against such crises.” HEARINGS BEFORE THE SUBCOMMITTEE ON CONSUMER PROTECTION AND FINANCE OF THE HOUSE COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE, ON HR 5571, ET. AL. 96th Cong., 1st Sess., at 192 (Oct. 25, 26, Nov. 14, 15, 26, 27, 1979) (hereinafter “HEARINGS ON HR 5571”)(testimony of Victor E. Schwartz).

[7] The Commerce Department explained: “Perhaps more significant than any other single factor alleged to be the cause of the nationwide product liability insurance problem are the rules governing the responsibility of product sellers for older products.”  UPLA, 44 Fed. Reg. at 62733.  I discussed manufactuers’ duty to warn about the dangers of older products in Bernard W. Bell, The Manufacturer’s Duty to Notify of Subsequent Safety Improvements, 33 STAN. L. REV. 1087 (1981).

[8] The Task Force did express concerns about the use of unqualified experts in products liability cases, and section 117 of the UPLA is designed to address this question.  It suggested channeling products liability claims to arbitration, where unbiased experts could be used to guide the arbitrator, or, absent that, a greater role for the trial court in excluding potential expert testimony.  The U.S. Supreme Court tackled that issue in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993), and Kumho Tire Co. v. Carmichael, 526 U.S. 137 (1999).

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