September 2007

From the editors of Wolters Kluwer Law & Business, this update describes important developments from CCH products liability and safety publications.

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Commercial Availability Demonstrated Alternative Design Feasibility
Evidence that a sport-utility vehicle with lower center of gravity would not have rolled-over untripped and that similar vehicles were available commercially satisfied an injured driver's burden of offering a feasible alternative design, the U.S. Court of Appeals for the Fourth Circuit determined in an unpublished opinion. The driver's sport-utility vehicle rolled over and was struck by a tractor trailer when he swerved to avoid another vehicle. The vehicle manufacturer argued that the trial court erred in not granting its motion for judgment as a matter of law on the ground that the driver failed to establish the existence of an alternative feasible design. The court noted that the driver's expert offered sufficient evidence that, at the time his vehicle was manufactured, several other sport-utility vehicles already on the market had centers of gravity low enough to prevent untripped roll overs similar to the driver's accident. The court ruled that the existence of an alternative design's commercial availability was sufficient to demonstrate the feasibility of the design, removing the need for expert testing to prove feasibility (Simo v. Mitsubishi Motors N. Am., 4th Cir., CCH Products Liability Reporter ¶17,806 (ip access user)).

Despite Replacement Device Design, FDA Approval Preempted Claim
Although a patient's proposed alternative design for an implantable defibrillator battery was already being used by the manufacturer and approved by the Food and Drug Administration (FDA), the patient's claims were preempted because the allegedly defective design was still approved by the FDA, a Wisconsin appeals court held. After discovering a shorting problem with the original design for batteries included in its implantable defibrillators, the manufacturer sought FDA approval for an improved and re-designed battery. Despite the existence of the re-designed battery at the time of the patient's surgery, the patient received the original battery, which the manufacturer continued to sell after it released the new battery design. The patient underwent explant surgery to replace his implant and brought a design defect claim against the manufacturer, asserting that the original battery design was defective, the re-designed battery was a feasible alternative design, and the manufacturer was negligent in continuing to sell the original batteries after it became aware of the shorting problem. The court found that the patient's claims against the manufacturer were preempted because they threatened to impose a conflicting state requirement to the extent that they would require the manufacturer to choose among the two FDA-approved components. The court concluded that the manufacturer was entitled to clear its inventory of the less-safe original design because the original battery was approved by the FDA (Blunt v. Medtronic, Inc., Wis. Ct. App., CCH Products Liability Reporter ¶17,807 (ip access user)).

Despite Replacement Device Design, FDA Approval Preempted Claim
The U.S. Court of Appeals for the First Circuit sent a certified question to Maine's Supreme Judicial Court asking whether the state would adopt a post-sale duty to warn for indirect customers. A forklift operator was killed by the horizontal intrusion of a warehouse shelf into the operator's cabin. Although the risk of horizontal intrusions into forklift operator cabins was known when the forklift was designed, changes in the layout of warehouses and the design of warehouse shelving significantly increased the risk to forklift operators. To address the increased risk, the forklift manufacturer mailed out a warning of the risk to customers and offered users a replacement backrest extension to reduce the risk of injury. Neither the deceased forklift operator nor his employer, however, received the post-sale warning or notice of the new backrest because the warning was only sent to direct purchasers and the deceased operator's employer had purchased the forklift used from the secondary market. The operator's estate argued that the manufacturer had a post-sale duty to warn both direct and indirect purchasers of the forklift. The appeals court acknowledged the split among states regarding the existence of a post-sale duty and lack of case law indicating whether a post-sale duty would be recognized under Maine law. The court noted Maine's history of adopting other portions of the Restatement (Third) Torts: Products Liability but concluded the issue should be directed as a certified question to Maine's Supreme Judicial Court. (Brown v. Crown Equip. Corp., 1st Cir., CCH Products Liability Reporter ¶17,812 (ip access user))

Consumer Product Safety

Toy Recall Problems Raise Concerns for CPSC
At a September 19 hearing of the House Subcommittee on Commerce, Trade and Consumer Protection, Consumer Product Safety Commission (CPSC) Commissioner Thomas H. Moore told Congress that blame for the recent wave of toy recalls needs to be shared by a number of parties—including the administration, Congress, regulators, manufacturers, importers, retailers, and "anyone else who may have been active or inactive participants in enabling the policy decisions and priorities that have led us to this point." Moore said those who stood by and "quietly acquiesced while the Commission was reduced to a weakened regulator, largely relying on the regulated to regulate themselves, must examine and correct the role that they played in putting the commission in its current state." Congress did the right thing, according to Moore, by rejecting the administration's staffing and budget proposal for fiscal year 2008, which would have resulted in the loss of 19 full-time employees. However, Moore added that the situation would not be resolved by simply throwing resources at the Commission in response to public alarm over recent recalls. Instead, Moore said he favored an incremental approach to increasing the CPSC's budget and staff. “It has taken years for the commission to get to its present position and it will take years to correct," said Moore. Acting CPSC Chairman Nancy A. Nord told the hearing that far from shrinking from the recent publicity, she welcomed the attention the CPSC was now getting. "Our small agency I think has been ignored by the Hill and by the public for way too long." Meanwhile, a sweeping reauthorization bill for the agency, titled the CPSC Reform Act of 2007 (S. 2045), was introduced by Senator Daniel K. Inouye (D-Hawaii). In his introductory remarks on the Senate floor, Inouye characterized the agency as badly underfunded, understaffed, and overworked. The Inouye/Pryor bill would authorize the agency at $80 million for fiscal year 2009, with 10% annual increases until it reaches approximately $142 million for fiscal year 2015. The bill also would increase staffing levels. According to Inouye, the agency had many more workers on its payroll back in 1973 when it was established and when it was responsible for overseeing many less consumer products. "This bill takes great strides in restoring these staffing levels," Inouye said. In addition, the reform bill would significantly boost the civil penalties violators of consumer protection laws could face. The maximum civil penalty would skyrocket, from $8,000 to $250,000. Similarly, the maximum penalty for a related series of violations would soar from the current $1.8 million to $100 million. The bill would also make it easier for prosecutors to find violators criminally negligent. Finally, the reforms would ban the use of lead in children's products, and set maximum trace amounts allowed. (CCH Consumer Product Safety Guide, Report No. 899, September 28, 2007)

U.S., China Agencies Reach Agreement on Toy Safety
The Second Biennial Sino-U.S. Consumer Product Safety Summit, held on September 11, in Washington, D.C., between the Consumer Product Safety Commission (CPSC) and the agency's counterpart in China, the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), resulted in a cooperative effort to promote the safety of children's toys and other consumer products. AQSIQ agreed to take immediately action to eliminate the use of lead paint on toys manufactured in China for export to the United States. Lead paint on toys sold in the U.S. has been prohibited since 1978. The agencies also announced work plans for bilateral efforts to improve consumer product safety in four product categories that represent some of the most frequent hazards within the regulatory jurisdiction of the CPSC: toys, fireworks, cigarette lighters, and electrical products. According to CPSC Acting Chairman Nancy Nord, the agreement is "an important signal from the Chinese government that it is serious about working with CPSC to keep dangerous products out of American homes." The summit also produced an agreement by AQSIQ to increase inspections of consumer products designated for shipment to the U.S., and to assist the CPSC in tracing hazardous products to manufacturers, distributors and exporters in China. Both agencies will review the effectiveness of the plan within one year in order to identify areas for improvement. CPSC Acting Chairman Nancy Nord commented that the CPSC will be looking for "meaningful cooperation on the ground—that means not just with the Chinese government, but also with industry at both ends of the supply chain." (CCH Consumer Product Safety Guide, September 28, 2007; ¶56,270)

NHTSA, China Enter Cooperative Motor Vehicle Safety Agreement
A Memorandum of Cooperation was entered between the National Highway Traffic Safety Administration and the National Development and Reform Commission (NDRC) of the People's Republic of China to improve the relationship between the U.S. and China in the area of motor vehicle safety. The bilateral arrangement establishes a range of cooperative goals, including the development of safety standards for automotive equipment and the enforcement of those standards. The memorandum also encourages development and dissemination of consumer information, automotive safety research, and cooperative efforts to improve fuel economy. Officials from both agencies exchanged information regarding each country's respective processes for conducting safety investigations and recalling motor vehicles and motor vehicle equipment, and the requirements and procedures employed to promote compliance with safety standards. (NHTSA Release #15-07, September 12, 2007; CCH Consumer Product Safety Guide, September 28, 2007; ¶56,271)

Motor Vehicle Side Impact Protection Standard Upgraded
According to the National Highway Traffic Safety Administration, an estimated 311 lives will be saved and 361 serious injuries prevented every year by changes made to Federal Motor Vehicle Safety Standard (FMVSS) No. 214, "Side Impact Protection." The safety standard, prior to amendment, required thoracic and pelvic protection in a test that used a moving deformable barrier to simulate being struck in the side by another vehicle. The final rule amended the standard by requiring passenger vehicles to protect front seat occupants in a vehicle-to-pole test that simulates a vehicle crashing sideways into narrow fixed objects such as utility poles and trees. The standard, as amended, requires vehicle manufacturers to assure head protection and improved chest protection in side crashes for a broad range of occupant sizes and across a variety of seating positions, and includes for the first time a limit on the risk of head injury for occupants in the rear seat. Two new, scientifically advanced test dummies representing a wide range of occupants, from mid-size males to small females, will be used to test vehicles. A crash test dummy known as the ES-2re will represent mid-size adult male occupants, and a dummy known as the SID-IIs, which is the size of a 5th percentile adult female, will represent smaller stature occupants. The more biofidelic ES-2re replaced the 50th percentile male dummy previously used in the front seat of tested vehicles, and the new 5th percentile female SID-IIs dummy used in the rear seat will improve protection to a greater segment of occupants in rear seating positions. According to NHTSA, the final rule also was intended to promote new technologies, such as side curtain air bags and torso side air bags, capable of improving head and thorax protection to occupants of vehicles that crash into poles and trees and of vehicles that are laterally struck by a higher-riding vehicle. The agency believes that side air bag systems installed to comply with the requirements of the final rule also will reduce fatalities and injuries that result from partial ejections through side windows. Manufacturers must begin equipping vehicles with improved side-impact protection that complies with the new standard beginning in 2009. (CCH Consumer Product Safety Guide, September 28, 2007; ¶56,271)

Child Seat Installation Procedures Added to Crash Protection Standard
Federal Motor Vehicle Safety Standard No. 208, "Occupant Crash Protection," was amended by establishing test procedures for the installation of child restraints to a child restraint anchorage—or LATCH—system in the front passenger seat of vehicles certified to meet advanced air bag requirements through the use of a suppression system or a low risk deployment (LRD) system. Advanced air bag regulations require that vehicles suppress the air bag in the presence of a child restraint system that is attached to the vehicle's LATCH system. The LRD option involves deployment of the air bag in the presence of a Child Restraint Air Bag Interaction test dummy that represents a 12-month-old child in a rear-facing child restraint. To allow vehicle manufacturers sufficient time to certify that their vehicles meet FMVSS No. 208 suppression or LRD requirements when tested using the new procedures, NHTSA designated a compliance date of September 1, 2008, for the final rule. The agency therefore will apply the new test procedures to vehicles manufactured on or after September 1, 2008 that have a LATCH system in a frontal seating position and are certified to meet advanced air bag requirements through the use of a suppression or LRD system. The agency believes the new procedures will ensure that the child restraints will be installed in a repeatable and reproducible manner. The final rule became effective September 1, 2007. (CCH Consumer Product Safety Guide, September 28, 2007; ¶41,963)