New Federal Products Deal Hurts Consumers

A proposed new federal products liability bill would dictate standards in all states for the first time in U.S. history. Each of these standards would weaken the rights of innocent consumers and workers who are wrongfully injured by defective products. The proposal would create a framework, easily added to in future Congresses, that could do even more damage to the people our civil justice system is designed to protect. In several key areas, the bill would only preempt state laws that are more pro-consumer than the federal bill. Here are some of the major concerns:

ASBESTOS. Meant to exempt asbestos cases, the bill contains an exception for injuries caused by "toxic harm" but fails to define the term. Without a definition, there is considerable uncertainty whether asbestos (as well as other dangerous substances) would be treated, as a matter of law, as toxic substances.

$250,000 CAP ON PUNITIVE DAMAGES. Or two times compensatory damages, whichever is less, for corporations with fewer than 25 full-time employees and annual revenues of $5 million or less.

CAUSATION REQUIREMENTS. The bill establishes a new federal standard for awarding punitive damages in all products liability cases by requiring the plaintiff to show a direct causal link between the defendant's behavior and the plaintiff's injury.

NEGLIGENT GUN MANUFACTURERS & SELLERS. Gun manufacturers are completely covered by the bill, even though many small companies produce "junk" guns. Manufacturers large and small will benefit from the tougher standards imposed on plaintiffs seeking punitive damages in gun-related cases.

BREAST IMPLANTS. The bill exempts breast implant cases from the liability protections where the harm to the plaintiff was caused by silicone gel or a silicone envelope of an implant containing silicone gel. However, under this deal, companies, distributors and sellers of silicone envelopes, saline and polyurethane breast implants could be protected by the bill's limitations on civil actions.

SPECIAL BUSINESS EXCEPTION. The complete unfairness of this legislation is laid bare by the bill's special exemption for lawsuits filed by businesses for any commercial loss suffered as a result of a defective product. In other words, the cap on punitive damages and other limitations on recovery would apply to injured consumers but not to businesses whose only harm is lost profits!