At least half the states have considered or enacted legislation attempting to protect so-called innocent sellers — defendants to a product liability claim other than the manufacturer of a product. Product liability law generally does not require privity between the plaintiff and the manufacturer, and consequently anyone in the chain of distribution may become a defendant. Nonmanufacturing sellers often decry the fact that plaintiffs add them to product liability lawsuits, arguing that defending such claims raises the costs of doing business, increases the premiums charged by insurance companies and makes it more difficult to compete internationally.
Perhaps perceiving this to be a national problem, earlier this year the House of Representatives introduced a bill entitled the Innocent Sellers Fairness Act. H.R. 5500, 109th Congress, 2nd Session, May 25, 2006. But arguments about the high cost of litigation apply to each entity in the chain of distribution and are not unique to nonmanufacturing sellers. The state statutes and the Innocent Sellers Fairness Act ignore the reality of product liability lawsuits and potentially create more disputes than they resolve.
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