Ensuring safety after the sale: manufacturers of dangerous products may have a duty to warn consumers even when a product's hazards are not known until after it hits the market.

Experienced farmers are accustomed to working with large, and sometimes dangerous, pieces of equipment for cultivating fields. They learn how to operate them properly and heed the manufacturers' safety warnings. But when there are no warnings, tragedy can strike.

That is what happened to Ryan Patton in the spring of 1990. He was seriously injured when a large "wing" on the side of a field cultivator fell on him while he was conducting routine maintenance. Although the hazard that led to the injury was unknown to the manufacturer, Hutchinson Wil-Rich Manufacturing Co., when it introduced the cultivator into the market in 1971, evidence obtained in Patton's lawsuit showed that the company had received reports of injuries from falling wings as early as 1983. In 1994, after a jury awarded Patton substantial damages, the manufacturer began a campaign to notify owners about the danger and made a safety latch available for installation on the wings. (1)

When a manufacturer does not know or have reason to know that a product is hazardous when it is sold, but later discovers the hazard, the company may nevertheless have a duty to warn consumers of the product's dangers. The law imposes the postsale duty to warn on a manufacturer as part of its duty of reasonable care.

Products liability claims based on the postsale duty to warn are nothing new: More than 40 years ago, the Michigan Supreme Court held that a manufacturer's duty to warn consumers about defects in a product does not necessarily end when it is sold. (2)

Since then, almost all the jurisdictions that have been called on to decide whether to impose a postsale duty to warn have done so. About half of the states have not yet addressed the issue. In those states, cases that deal with a manufacturer's duty to warn of a product's dangers before it is sold provide the basis for plaintiff attorneys to argue that this duty should be imposed after sale as well. The 1998 Restatement (Third) of Torts: Products Liability provides powerful support for this emerging theory.

Evolution of the duty

The postsale duty to warn is based on negligence rather than strict liability in tort. A manufacturer's duty to warn of a product's dangers after its sale is compatible with and has evolved from the traditional point-of-sale duty to warn. (3) In both situations, the objective "reasonable person" test is used to determine the manufacturer's liability. (4)

Because the reasonableness of the manufacturer's conduct is at issue, the evidence must show that the defendant had actual or constructive knowledge of a product's risk in order to impose a duty to warn. In contrast, the standard for imposing liability on a manufacturer based on strict liability principles is the existence of an unreasonably dangerous defect in the product at the time of sale.

Besides being consistent with common sense, imposing a postsale duty to warn serves the same purpose as imposing the duty at the time of sale--to reduce the chance of injury by ensuring that the consumer has the benefit of all the information at the manufacturer's disposal. (5) As one court put it, "A duty to warn exists where there is unequal knowledge, actual or constructive, and the defendant knows or should know that harm might ... occur if no warning is given." (6)

A duty to warn exists when a party reasonably foresees a danger of injury or damage to someone less knowledgeable, unless an adequate warning is given. (7) A manufacturer's duty to warn arises from its superior knowledge of the dangers its product poses. (8) Once the duty attaches, "the law demands only that the method used give reasonable assurance that the information will reach those whose safety depends upon their having it." (9)

Prescription drug and medical device cases have been instrumental in developing the postsale duty to warn. Prescription drug manufacturers that received reports of adverse reactions to their products after they were placed on the market have been held liable for failing to warn consumers of those reactions.

For example, in McEwen v. Ortho Pharmaceutical Corp., the plaintiff sued two drug companies for failing to warn doctors that their oral contraceptives could cause blindness and other eye injuries. The Oregon Supreme Court, affirming a judgment for the plaintiff and citing an earlier Eighth Circuit decision, held that "the drug manufacturer is treated as an expert in its particular field, and is under a `continuous duty ... to keep abreast of scientific developments touching upon the manufacturer's product and to notify the medical profession of any additional side effects discovered from its use.'" (10)

Although, arguably, the obligations of prescription drug companies are greater than those of other manufacturers because of the nature of their products and the advertising and labeling regulations that apply to them, these cases provide a foundation for extending a postsale duty to warn to companies that manufacture other products, such as chemical and industrial products. (11)

Cases dealing with prescription drugs have helped to establish what is required for an adequate postsale warning and when these warnings must be given. Courts have held that the "manufacturer's duty to warn is ... commensurate not only with its actual knowledge gained from research and adverse reaction reports but also with its constructive knowledge as measured by scientific literature and other available means of communication." (12)

The restatement approach

The 1998 Restatement (Third) of Torts: Products Liability is generally viewed as favorable to products manufacturers and sellers. However, [section] 10 establishes the postsale duty to warn as a recognized cause of action supported by legal scholars (13) and a developing line of cases. This section provides plaintiff lawyers with strong arguments for obtaining discovery of postsale actions by the manufacturer after it learned of the dangers of a product already on the market, admitting into evidence other similar incidents of injury or death, and establishing a persuasive evidentiary basis for the imposition of punitive damages.

Under the section, a seller or distributor of a product (under the restatement's definitions, these include a manufacturer) may be liable for harm caused by its failure to warn of a product's dangers when "a reasonable person in the seller's position" would have provided a warning. (14)

According to the restatement, a reasonable person in the seller's position would provide a warning after the time of sale if:

* The seller knows or reasonably should know that the product poses a substantial risk of harm to persons or property.

* Those to whom a warning might be provided can be identified and can reasonably be assumed to be unaware of the risk.

* A warning can be effectively communicated to and acted on by those who would receive it.

* The risk of harm is sufficiently great to justify the burden of providing a postsale warning. (15)

Comments to the restatement provide helpful insight into the policy considerations and rationale for imposing the postsale duty to warn, and give examples of its application. (16)

Defendants typically contend that the court must decide whether the jury could reasonably find that a manufacturer could have issued a postsale warning practically and effectively under the circumstances of the case and that the risk of harm justified a warning. Plaintiff counsel should argue that if the plaintiff has proof to support each of the four restatement factors, then questions of fact exist that the jury should resolve. The jury should be instructed about the four factors and be permitted to use them in evaluating the evidence and deciding whether a manufacturer should have given a postsale warning. (17)

Even states that have not adopted the restatement have used similar factors in imposing a postsale duty to warn. These factors include:

* the nature and likelihood of the harm

* the number of people affected

* the economic burden of identifying and contacting product users

* the nature of the industry

* the type and number of products involved

* the number of reported incidents involving the product

* any steps that were taken to correct the problem

* the likelihood that the warning will be heeded. (18)

Ironically, one state has adopted a tort "reform" statute that includes language supporting a postsale duty to warn under common law negligence principles. (19)

Forging ahead

Almost all states that have decided whether to impose a postsale duty to warn on product manufacturers and sellers have concluded that the policy arguments in favor of doing so far outweigh those against it. The Restatement (Third) of Torts: Products Liability now provides the legal ammunition for states that are lagging behind to forge ahead. Plaintiff attorneys in those states can help secure the adoption of this important cause of action.

Notes

(1.) Patton v. Hutchinson Wil-Rich Mfg. Co., 861 P.2d 1299 (Kan. 1993).

(2.) Comstock v. Gen. Motors Corp., 99 N.W.2d 627, 634 (Mich. 1959).

(3.) See LOUIS R. FRUMER & MELVIN I. FRIEDMAN, 1 PRODUCTS LIABILITY [section] 2.22(2) (1991).

(4.) See, e.g., Olson v. Prosoco, Inc., 522 N.W.2d 284, 289-90 (Iowa 1994) (presale duty); Lovick v. Wil-Rich, 588 N.W.2d 688 (Iowa 1999) (postsale duty).

(5.) Lovick, 588 N.W.2d 688, 694.

(6.) Miller v. Dvornik, 501 N.E.2d 160, 164 (Ill. App. Ct. 1986).

(7.) Beeman v. Manville Corp. Asbestos Disease Comp. Fund, 496 N.W.2d 247, 252 (Iowa 1993) (citing Lakatosh v. Diamond Alkali Co., 208 N.W.2d 910, 913 (Iowa 1973)); West v. Broderick & Bascom Rope Co., 197 N.W.2d 202, 209 (Iowa 1972) (adopting and applying RESTATEMENT (SECOND) OF TORTS [section] 388 (1965)).

(8.) Beeman, 496 N.W.2d 247, 252.

(9.) Cooley v. Quick Supply Co., 221 N.W.2d 763, 772 (Iowa 1974). See also Owens-Illinois, Inc. v. Zenobia, 601 A.2d 633, 645-47 (Md. 1992); Hodder v. Goodyear Tire & Rubber Co., 426 N.W.2d 826 (Minn. 1988); Smith v. FMC Corp., 754 F.2d 873, 877 (10th Cir. 1985); Novak v. Navistar Int'l Transp. Corp., 46 F.3d 844 (8th Cir. 1995).

(10.) 528 P.2d 522, 528 (Or. 1974) (quoting Schenebeck v. Sterling Drug, Inc., 423 F.2d 919, 922 (8th Cir. 1970) (applying Arkansas law)).

(11.) See Wooderson v. Ortho Pharm. Corp., 681 P.2d 1038, 1057 (Kan. 1984); Mason v. Texaco, Inc., 741 F.Supp. 1472, 1482 (D. Kan. 1990); Blackburn, Inc. v. Harnischfeger Corp., 773 F. Supp. 296, 301 (D. Kan. 1991). But see Bd. of Trs. of Johnson County Cmty. Coll. v. Nat'l Gypsum Co., 733 F. Supp. 1413, 1417 (D. Kan. 1990).

(12.) McEwen, 528 P.2d 522, 528-29. See also Wooderson, 681 P.2d 1038, 1050-51; Schenebeck, 423 F.2d 919, 922; O'Hare v. Merck & Co., 381 F.2d 286 (8th Cir. 1967) (applying Minnesota law); Baker v. St. Agnes Hosp., 421 N.Y.S.2d 81, 85 (App. Div. 1979).

(13.) See, e.g., Douglas R. Richmond, Expanding Products Liability: Manufacturers' Post-Sale Duties to Warn, Retrofit, and Recall, 36 IDAHO L. REV. 7 (1999); Kenneth Ross, Post-Sale Duty to Warn: A Critical Cause of Action, 27 WM. MITCHELL L. REV. 339 (2000); Frank E. Kulbaski III, Statutes of Repose and the Post-Sale Duty to Warn: Time for a New Interpretation, 32 CONN. L. REV. 1027 (2000).

(14.) RESTATEMENT (THIRD) OF TORTS [section] 10(a) (1998).

(15.) Id. [section] 10(b).

(16.) See id. [section] 10 cmts. a-j.

(17.) See Lovick, 588 N.W.2d 688, 696.

(18.) See, e.g., Patton, 861 P.2d 1299; Liriano v. Hobart Co., 700 N.E.2d 303, 307 n.3 (N.Y. 1998); Cover v. Cohen, 461 N.E.2d 864, 872 (N.Y. 1984). See also Lewis v. Ariens Co., 751 N.E.2d 862, 868 n.18 (Mass. 2001).

(19.) IOWA CODE [section] 668.12 (1998). See also OHIO REV. CODE ANN. [section] 2307.76 (Anderson 2002); WASH. REV. CODE [section] 7.72.030(1)(c) (1992); LA. REV. STAT. ANN. [section] 9:2800.57C (1997).

Gary D. McCallister practices law with Gary D. McCallister & Associates in Chicago. (c) 2002, Gary D. McCallister.