There are very few legal monopolies in the United States. Underwriters Laboratories (UL) is one of them, Many people believe that UL is some sort of governmental entity, but, in fact, it is a private, moneymaking company. UL receives millions of dollars in fees and employs, directly or indirectly, hundreds, if not thousands, of people all over the world. In some states and local jurisdictions, it is illegal to sell electrical items without a UL inspection and seal of approval. Even where it is not illegal, as a practical matter, no distributor or retailer will sell an electrical item without a UL logo.
In this worldwide economy that we live in, it is increasingly rare to find an electrical product, including items as simple as light bulbs, that are actually manufactured in the United States. The companies that manufacture these items are often immune from any financial responsibility for injuries caused by their products in the U.S. A lawsuit filed in the U.S. and served under international treaties is often ignored by these companies. Even if one were to obtain a judgment against a foreign manufacturer and try to enforce it, the manufacturer might simply change its name and reopen the next day.
Fortunately, some of this shoddy merchandise is imported by domestic distributors and sold by reputable retailers who, under well-settled products liability law, are liable even though they had nothing to do with manufacturing the product. Often however, the retail seller is unknown because the product is not new. In some cases, it is possible to identify the importer, but these importers are often as sleazy as the foreign manufactures and either have little or no coverage or will go in and out of business and change names at the drop of a hat. There are no import laws in the U.S. requiring insurance coverage or in any way protecting the consumer in terms of bringing the foreign manufacturers to justice.
Role of UL
UL publishes volumes of technical rules and regulations, allegedly designed to protect the public from defective electrical products and to prevent injury from either electrocution or fire. Because the marketplace demands a UL logo in order to sell products in the U.S., UL engages inspectors (usually independent contractors) all over the world who do random inspections of factories and examine and ship sample products back to the U.S. for testing under UL standards.
One would assume that, in a case where UL standards are not met, but somehow the product is approved by UL anyway, UL would concede that the product failed to meet these standards and that this could result in either electrocution or fire. But in a recent case handled by our firm in the Torrance Superior Court, UL took the opposite position and argued that, even if there was a lack of compliance with UL standards, the product would not cause either an electrocution or fire. This raises the obvious question as to the purpose for UL inspections and the millions of dollars in fees paid by manufacturers for the all-important UL logo.
Christmas Tree Fires
There are hundreds of Christmas tree fires every year, causing millions upon millions of dollars in property damage and innumerable deaths and disfiguring burns. Many of these are attributable to defects in Christmas tree lights. Very few people currently use the large lights which were popular years ago; most now buy the small mini-lights. Because strings of Christmas tree lights are very low voltage, it was the position of UL, in this recent case, that they could not possibly cause electrocution or fire, even assuming that they were manufactured in violation of UL standards that were designed to prevent electrocution or fire. In this case, the identity of the retailer was hotly disputed, the importer had a single limits policy which was mostly exhausted and the owner of the rented premises where the plaintiff and his family resided had minimal exposure. As a result, the recovery for a horribly disfigured pre-kindergarten child severely burned in a Christmas tree fire was less than $500,000 from these marginal defendants.
Accordingly, we elected to proceed against UL as the prime defendant. The case was settled in the middle of a lengthy trial in Torrance for a confidential amount. As a result of massive discovery from coast to coast and working with innumerable experts, we became unbelievably familiar with UL's guidelines and procedures, particularly as they relate to foreign manufactured Christmas tree lights. UL has numerous technical requirements, having to do with the necessity to avoid exposed wires within the lamp holders, the quality of the lamp holders themselves and the methods of manufacturing these lights. Unfortunately, the mainland Chinese plants which manufacture them turn out millions of boxes of these products with little or no quality control and often through arrangements with cottage industries out of people's homes. The result is that it is nearly impossible for the UL standards to be complied with, since the level of quality control is not remotely similar to what one might see in a GE toaster. The random UL inspections done at the factory are usually performed by mainland Chinese nationals who allegedly make surprise inspections and pull boxes of lights at random for inspection. UL relies on the honesty and integrity of these people who work in a country in which bribery is standard and close cooperation between the successful owner of the plant and some local inspector would not be surprising.
Evidence Destroyed
In the typical Christmas tree fire, or any fire involving a shoddy foreign made electrical product, it is not unusual for the product to be destroyed in the fire. Products liability law makes it clear that a defect in a product can be established by circumstantial evidence, even in the absence of the product. The first step therefore is to obtain exemplars from the same lot made by the same foreign manufacturer in order to perform testing. This involves thorough investigation, not only to find exemplar products, but also to prove that they were manufactured at the same factory in China at the same time as the lights destroyed in the Christmas tree fire.
UL's Defense
In our case, exemplars made by the same manufacturer at the same time as the lights destroyed in the fire were obtained through painstaking efforts. Expert testimony and other evidence established that the exemplars probably came from the same lots as the lights which caused the fire. It therefore became a question of proving that these defects were not only in violation of UL standards and that UL was negligent for allowing these lights to bear the UL logo, but also that these violations could have caused the fire.
UL's defense was first that the 3-year-old plaintiff probably set fire to the tree with a fireplace lighter or a match and that, even if the child did not set the tree on fire. Thus, the trial boiled down to testimony between competing experts as to whether defects in these lights could set fire to the tree, and the irony of this defense by the guardians of public was that UL was saying that all of its procedures, guidelines, and inspections don't really protect against anything.
UL takes the position that it performs an important public service, and it may very well be right, but one wonders whether there are other products made in sweatshops all over the world, sold to importers for peanuts and distributed to consumers in the U. S. which parallel our experience with Christmas tree lights. Because there is usually no ability to get jurisdiction over or obtained a collectible judgment against the manufacturer, the importers are often uninsured and the retailer is often unknown or disputed, the responsibility may fall on UL. After all, UL is the gatekeeper and has the ability to keep these products out of the American marketplace in the first place. Unfortunately, the law is clear that strict liability does not apply to UL and establishing negligent inspections or procedures where these inspections take place halfway around the world is a formidable task.