Product liability claims can range from defects in automobiles, consumer good to prescription drugs.  Products liability is a specialized area of law taking various forms, each requiring a different defense strategy. Many states apply a strict liability standard which means the manufacturer is automatically liable when a product injures a person.  But not North Carolina.

North Carolina applies a negligence standard set out in Chapter 99B of North Carolina’s general statutes. In addition to the assertion of negligence, plaintiffs may also have breach of warranty claims.  This blog will summarize the types of negligence and breach of warranty claims your company may face, as well as some products liability defenses available.

 

Negligence Claims

Products liability negligence claims typically fall in the following four categories:

• Inadequate Warnings: In an inadequate warning, the plaintiff must show that the manufacturer acted unreasonably in failing to provide such warnings, that the failure to provide adequate warning was a proximate cause of the harm, either:
  • (1) At the time the product left the control of the manufacturer or seller, the product, without an adequate warning or instruction, created an unreasonably dangerous condition that the manufacturer or seller knew or should have known posed a substantial risk of harm to a reasonably foreseeable claimant; or
  • (2) After the product left the control of the manufacturer or seller, the manufacturer or seller became aware of or should have become aware of the fact that the product posed a substantial risk of harm to a foreseeable claimant and failed to take reasonable steps to give adequate warning or instruction or to take other reasonable action.

• Inadequate Instruction: In an inadequate instruction claim, the plaintiff must show that the manufacturer acted unreasonably in failing to provide such instructions on how to use the product, that the failure to provide adequate instruction on how to use the product was a proximate cause of the harm either:
  • (1) At the time the product left the control of the manufacturer or seller, the product, without an adequate instruction on use, created an unreasonably dangerous condition that the manufacturer or seller knew or should have known posed a substantial risk of harm to a reasonably foreseeable claimant; or
  • (2) After the product left the control of the manufacturer or seller, the manufacturer or seller became aware of or should have become aware of the fact that the product posed a substantial risk of harm to a foreseeable claimant and failed to take reasonable steps to give adequate instruction on use or to take other reasonable action.

• Negligent Manufacturing: Negligent manufacturing claims occur when a product is negligently and improperly manufactured contrary to its intended design.

• Negligent Design/Formulation: Inadequate design or formulation claims require a plaintiff to show that at the time of its manufacture the manufacturer acted unreasonably in designing or formulating the product, that this conduct was a proximate cause of the harm for which damages are sought, and either:
  • • (1) At the time the product left the control of the manufacturer, the manufacturer unreasonably failed to adopt a safer, practical, feasible, and otherwise reasonable alternative design or formulation that could then have been reasonably adopted that would have prevented or substantially reduced the risk of harm without substantially impairing the usefulness, practicality, or desirability of the product; or
  • • (2) At the time the product left the control of the manufacturer, the design or formulation of the product was so unreasonable that a reasonable person, aware of the relevant facts, would not use or consume a product of this design.

 

Breach of Warranty Claims

As we mentioned earlier, in addition to negligence claims, plaintiffs may have a breach of warranty claim available to them. Generally, in North Carolina, there are two types of breach of warranty claims that may be available to a plaintiff.

• Express Warranty: An express warranty is one that expressly guarantees that the product will meet a specific level of quality. They can be either verbal or in writing.

• Implied Warranties: Implied warranties generally fall into two categories:
  • (1) The implied warranty of merchantability which states that a product will perform of the purpose of which it was designed; and
  • (2) The implied warranty of fitness, which states that a product will reasonably perform a purpose specific to the intentions for which the product was purchased by the consumer.

A breach of warranty claim requires a plaintiff to prove that (1) the defendant warranted the product (express or implied) to plaintiff, (2) there was a breach of that warranty in that the product was defective at the time it left the control of the defendant, and (3) the defect proximately caused plaintiff damage. Plaintiff need not show that the defendant acted negligently in a breach of warranty claim.

 

Defenses to Products Liability Claims

In addition to standard defenses in any North Carolina tort action, there are several products liability specific defenses of which your company should be aware.

• Lack of privity: To sue a defendant under a breach of warranty theory of liability, the plaintiff must have standing to do so, and standing is based upon privity. Under North Carolina law, a claimant who is a buyer or a member or a guest of a member of the family of the buyer, a guest of the buyer, or an employee of the buyer is deemed to be in privity with the manufacturer and, therefore, has standing to sue.
• Alteration of modification of the product: A claim may not exist where the product is altered or modified by a party other than the manufacturer or sell after the product left the control of the manufacturer or seller.
• Knowledge or reasonable care: A claim may not exist where the product was used contrary to its instructions or warnings, or where the user knew of or discovered a defect and used the product anywhere, or where the user failed to use reasonable care in using the product.
• Statute of Limitations/Statute of Repose: North Carolina’s statute of limitations or repose may also prevent the claimant from bringing suit. If the plaintiff waits too long to bring suit, the product liability claim will be barred.
• Sealed Container: The plaintiff would not have a claim against a seller who received and sold the product in a sealed container when the seller had no reason to open the sealed container and inspect the product.

This is not an exhaustive list of defenses to products liability and breach of warranty claims. Product liability claims are multifaceted and often require the use of experts to offer opinions.  Given these complexities, you will need a strong defense team to navigate these often stressful and costly lawsuits.

Have questions about a products liability claim? Reach out to a member of Teague Campbell’s Products Liability team.