How 5 Cases (Mostly) Made Product Liability Law in the United States

Natalie JaroszewskiSeptember 19, 2022 10 minutes

That you can hold a manufacturer accountable for a defective product is as obvious to anyone alive today as the fact that Americans elect their leaders. Modern product liability law is so ubiquitous that it's easy to forget just how new it is.

Less than 200 years ago, caveat emptor (buyer beware) was the prevailing view of both the law and the culture. In short, it was the purchaser's responsibility to ensure that the goods they purchased weren't going to kill them. This position is the polar opposite of the world we live in today.

How did we end up living in a world where we believe the complete opposite of what our great-great-grandparents did? This change didn't come about because of a civil war, major calamity, or large protest movement; instead 5 court cases paved the way for modern product liability law. Let's look at them and their impact.

Product Liability Law

Before I dive into the court cases that paved the way for modern product liability law, it's important that we're all on the same page concerning what product liability law is, and what it does. Product liability is the area of the law that holds persons or companies involved in the production of a product responsible (or liable) for the damages caused by a product if they are the reason for the resulting damages.

Numerous producers, vendors, warehouses, transportation companies, distribution centers, and retailers work to develop, produce, market, and distribute these manufactured goods. In any place along this chain, a defect can arise, and if a product has a defect that causes severe injury or death, a product liability lawsuit provides the victim a remedy for that injury.

The Not So Golden Days of Caveat Emptor

Before a court decision in 1852, less than 200 years ago, if you purchased a product from a retailer that had originally bought the product from a manufacturer, you would have had no way of holding the manufacturer accountable. This is because you wouldn't have had a contract with that manufacturer, only the retailer that you purchased from. If there was no contract, then there were no contractually obligated duties.

Essentially, if a manufacturer made a defective product, that didn't hurt the person who purchased it from them directly, then the manufacturer had no responsibility for that injury because there was no general duty to manufacture safe products. It was the sale of an item that created a duty to not hurt one specific purchaser. As long as the product didn't blow up in the purchaser's face (sometimes this was quite literal) the seller was in the clear.

This may seem ridiculous now, but originally markets were local. It was common to purchase directly from the producer with no middle-man distributor or retailer. As the world grew more interconnected and markets began to expand, retailers and distributors became more common. This put an increasing number of people in the position where they never met the person or interacted with the company that made the product they purchased.

Let's look at a quick example. Say a consumer purchased a saw from a retailer and then the saw's handle broke seriously injuring the consumer. The consumer could try to sue the retailer, but the retailer would claim they did not make the saw, only sold it. Then the consumer could try to sue the maker of the saw, but the manufacturer would claim they had no business with the consumer so they are not responsible to the consumer, only the retailer who bought the saw and resold it.

Consequently, there were several lawsuits (in a very short period) that attempted to address the new reality of mass markets, where a homesteader in Shells Lick, ID (it's a real town) could purchase anything from a catalog put out by a company in Chicago, and the goods were manufactured by companies around the country.

Thomas v. Winchester (NY 1852): Establishing a General Duty for Manufacturers

So, while there is no uniform product liability law in the United States, product liability laws across the USA are by and large similar, with experts largely agreeing that the foundational case for product liability law is Thomas v. Winchester (6 N.Y. 397).

In 1852, a manufacturer incorrectly labeled a poison as a medicine. The manufacturer sold the incorrectly labeled product to a pharmacist, who then sold it to a customer, Thomas. Thomas's wife nearly died due to ingesting the poison they believed to be medicine. Thomas sought to recover damages from the manufacturer who had first falsely labeled the poison as harmless medicine.

However, the manufacturer argued that they couldn't be liable to Thomas, since they never agreed to do business with him. Today, this argument shocks us, but as mentioned earlier, this is the case that laid the foundation for product liability.

The court ruled that any party who puts falsely labeled poison into the market, "puts human life in imminent danger" and is liable to the harmed person. Additionally, the court set the precedent that because the danger of selling poison as medicine is obvious and preventable, the manufacturer has a duty to avoid injury. That's two precedents established.

  1. A harmed consumer of a product can hold a manufacturer, whom they have no contract with, liable for the resulting damages.
  2. A duty of care is a legal obligation imposed on an individual, that requires them to use a standard of reasonable care while performing any acts that could foreseeably harm others.

However, it is important to recognize the distinct wording of the court's decision. The court specifically ruled that manufacturers have a responsibility to avoid "imminent danger." This means if a product is not dangerous, even if falsely labeled, a consumer is unable to seek a remedy from the manufacturer. For example, mislabeling water as soda does not create a danger to a customer. Water is not inherently dangerous, so there is no impending doom.

Devlin v. Smith (NY 1882): Extending Duties to Third Parties

Thomas established a very narrow set of circumstances where a purchaser could hold a manufacturer liable for a defect. Devlin extended that protection to those who used dangerous products.

The case began when a contractor built a scaffold for a painter. Then, while the painter's employees were using the scaffold, it broke, killing one of the workers. Even though a scaffold is not an "inherently dangerous" item, like the poison in Thomas, the court reasoned that the contractor would fully know that if he made the scaffold improperly, it would be dangerous for use.

Additionally, as it was made obvious to the manufacturer that the scaffold was to be used by persons other than the painter, the court ruled that the contractor owed the future scaffold users (the painter's employees) a duty to build the scaffold properly.

Devlin v. Smith expanded the Thomas v. Winchester decision in two ways. It provided 3rd parties a remedy, even if they were only using the product on behalf of the purchaser. It also expanded the definition of "imminent danger" to include not only things that are inherently dangerous like drugs and explosives but also products that represent a threat to life when improperly built.

MacPherson v. Buick Motor Co. (NY 1916)

Similar to Devlin, MacPherson v. Buick Motor Co. required the court to determine if an automobile was "inherently dangerous," posing an "imminent" threat if poorly constructed.

MacPherson purchased a vehicle from a retail dealer. While he was driving, one of the vehicle wheels broke, throwing him from the car.

Buick argued it couldn't be liable in two separate ways.

  1. First, Buick contended that it never entered into a contract with MacPherson, so it should win the case on those grounds. The court flat-out rejected this argument. This rejection opened the door for consumers to hold manufacturers accountable, even if they weren't making "imminently dangerous" products, i.e pretty much any product.
  2. Secondly, Buick argued that it didn't make the part that failed (Buick bought the wheel from a different company), so McPherson was suing the wrong business. Here, the court decided that Buick is still responsible. Basically, Buick should have known that bad parts could turn a safe car into a dangerous car, and they failed to examine the wheel properly.

Those two findings were huge. MacPherson v. Buick Motor Co. essentially replaced Thomas v. Winchester, because a victim no longer had to jump through the hoop of proving that a product posed an imminent danger.

"If the nature of a thing is such that it is reasonably certain to place life and limb in peril when negligently made, it is then a thing of danger."

MacPherson v. Buick Motor Co. (NY 1916)

Now a victim only had to prove that somewhere a manufacturer carelessly built the product, and the carelessness resulted in the victim's injury.

After this decision, manufacturers were required to prevent careless workmanship, ensuring they did not produce dangerous products. This is how most people understand product liability laws today. Most of us assume (and even take it for granted) that anyone who uses a product as it is intended, but is injured, is permitted to hold a manufacturer accountable.

In essence, MacPherson is the case where product liability law starts to emerge in a shape that we can recognize today, and that was barely 100 years ago.

Consequences of MacPherson and Its Shortcomings

So over time, the Thomas v. Winchester ruling of "imminent danger" extended to poisons, explosives, and other similar things, in which their normal use is inherently dangerous. However, even beyond that, courts gradually came around to the idea that any difference between inherently dangerous and imminently dangerous is irrelevant.

The expanded applications of Thomas v. Winchester allowed for product liability law to more directly address a contract's and/or product's implied warranties. Implied warranties evolved from both laws passed by legislators and laws created by court precedent, and they are assumed or understood promises from the manufacturers/sellers to the purchaser.

For instance, if I sell you a car, we don't have to take the time to list all the properties of a car that make it a car. Instead, the mere fact that it's a car means that we can imply certain things about it. Implications such as it should have a motor, wheels, steering device, and brakes. If you get a mile down the road, go to hit the brakes, crash because the car has no brakes, and injure yourself, I can't turn around and say that I never told you that I was selling you a car with brakes, and it's not my fault you assumed the car had some.

Implied warranties are the reason that if a manufacturer or retailer says a product can do something, it has to actually be able to do that something. They were also the next battleground in product liability law.

Henningsen v. Bloomfield Motors, Inc. (NJ 1960): Manufacturers Don't Get to Define Implied Warranties

As courts and legislatures began to flesh out implied warranties, many manufacturers sought to avoid the headache by inserting language into contracts that stated, in effect, "this product has no implied warranty." That was at issue in Henningsen v. Bloomfield Motors, Inc.

Mr. Henningsen purchased a Plymouth automobile, manufactured by Chrysler Corporation, from Bloomfield Motors, Inc., and gifted it to his wife. Bloomfield Motors, Inc. performed work on the Plymouth and the couple received the vehicle two days after purchase. 10 days after the couple received the vehicle, Mrs. Henningsen was driving around 20 to 22 mph when the steering wheel spun, turned the car 90 degrees, and crashed.

Bloomfield Motors Inc. argued that Mrs. Henningsen could not sue because of a fine print clause in the contract. The clause purposefully benefited the manufacturer and dealership by excusing them from any implied warranties. More simply put, the car dealer and Chrysler tried to get around their duty under the law by inserting language into the sales contract that said they weren't bound by the protections the law afforded purchasers.

The court ruled that a manufacturer/seller could not "define the scope" of their liability for a defective product. Additionally, the court emphasized "the role of public policy in protecting innocent buyers from the harm of manufacturers' defective articles."

That decision set the precedent that when a manufacturer puts a new automobile on the market, whatever warranties a contract attempts to absolve the manufacturer of, there will always be an implied warranty. By simply offering a vehicle for purchase, a manufacturer promises the eventual buyer that the car is "reasonably suitable for use." In other words, when you buy a car, it will have all the properties that make a car, a car.

So we moved from a system where you had to have a contract with the purchaser to hold them accountable, to one where manufacturers had a duty to make goods that didn't harm you, to one where even a written contract couldn't absolve a manufacturer of their duty to make a safe product.

After consumers were protected from misleading written contracts that attempted to remove a company's liability, it was a logical step that consumers would no longer need to prove how and/or why a manufacturer is liable for their products. A California case in 1963 did exactly that, influencing court decisions across the US.

Greenman v. Yuba Power Products, Inc. (CA 1963)

Until Greenman, holding a manufacturer accountable for a defect involved proving that the manufacturer failed to fulfill a duty owed to the injured consumer. Greenman simplified that matter.

It began when a customer purchased a multi-purpose power tool for her husband in 1955. Two years after receiving the tool, the husband then purchased a lathe attachment for the tool. "After he had worked on a piece of wood several times without any issue, [the wood] suddenly flew out of the machine and struck him on the forehead, inflicting serious injuries."

10 months after the incident, legal counsel advised Mr. Greenman to issue the retailer and the manufacturer a written notice. He then filed a complaint against them for breaches of warranties. The defendant, Yuba Power Products, Inc., argued that the consumer had broken the agreed contract by waiting too long to inform them of the defect and injury.

The court disregarded the timeframe argument and instead held that by simply putting a product into the stream of commerce, a manufacturer is strictly liable in the event a defect causes an injury.

Instead of jumping through a bunch of hoops to establish that a manufacturer owed the consumer a duty, after Greenman, those seeking to hold a manufacturer accountable only had to show that:

  1. They were using the product as it was intended.
  2. The product was defective.
  3. The defect caused their injury.

This may sound like legal nit-picking but the practical ramifications for those injured by defective products are enormous. This decision made it much easier for victims to seek a remedy for their injuries and truly held manufacturers accountable so that fewer defective products would enter the market. Sort of a "nip it in the bud" ruling.

Product Liability Law in the 21st Century

Originally, the US was an artisan economy where people usually knew the person who made the product they bought and where the duty "to not harm" existed only between those two groups. Then the evolution of mass markets allowed courts to establish that manufacturers must make safe products. Furthermore, the court established that potentially hundreds of millions of people, which manufacturers never even meet, can hold them accountable.

Thus, product liability emerged with some general guidelines:

  • If you are using a product, as the manufacturer intended, and it harms you when it should not have, you can seek a remedy through a court of law.
  • You can directly hold the person/company responsible for the defect even if you do not have a direct contract.
  • Finally, any contracts that are too technical or are intentionally beneficial only to the seller do not remove the product liability.

Modern product liability law doesn't mean that someone receives compensation just because a defective product injured them. It's not a welfare program for those injured by dangerous products, but it does provide the means, a lawsuit, for victims to hold manufacturers accountable. While victims still need to file a lawsuit and win, it's a far cry from the days of buyer beware. Most remarkably, the current state of affairs peacefully evolved over a relatively short period of time, and it completely remade how we look at the relationship between manufacturers and consumers. That's quite an accomplishment for 5 court cases.