When an automobile accident takes place, the attorney’s first reaction is to bring a claim against the other driver where warranted. However, in many circumstances, the other driver is not responsible or does not have sufficient insurance coverage for the injuries sustained. When this occurs, under the appropriate circumstances, inquiry into a products liability claim is warranted. This includes cases involving defective airbags, seatbelts, rollovers, faulty brakes, fuel fires, tire tread separation and innumerable other product failures.

Once the attorney has determined that a product defect contributed to the injuries, the next step is to determine the proper forum in which to sue the defendant. Foremost is the decision of whether it is most advantageous to file in federal or state court. For the most part, the defendant will be able to remove a case filed by a Pennsylvania plaintiff to federal court based upon diversity of citizenship. If the plaintiff is from Pennsylvania and purchased the car in Pennsylvania, bringing suit against the dealer will defeat diversity of citizenship, thereby allowing the claim to continue in state court.

A significant issue regarding how to try an automobile products liability case is determining whether the Restatement (Second) of Torts or Restatement (Third) of Torts will apply to the claim. Because individual state courts in turn adopt these general principles of common law, this article focuses on the significant differences between trying an automotive product case in Pennsylvania state court — according to the Second Restatement — and in federal court — according to the Third Restatement.

Some states have adopted the Third Restatement, while others have not. In Pennsylvania, the Supreme Court has adopted the Second Restatement and not yet determined whether to adopt the Third Restatement. The U.S. Court of Appeals for the Third Circuit has decided that the Supreme Court would adopt and apply the Third Restatement.

There are generally three types of products liability cases:

• A design claim, which presumes that an automotive product could have been made safer but was not. An example of this kind of case is a rollover in which the car was not adequately heavy or its center of gravity was not low enough.

• A manufacturer malfunction claim, which suggests that under normal wear and tear of the automobile, the product did not work as intended. In an auto accident, this could mean that a seatbelt or an airbag did not engage.

• A marketing/failure-to-warn claim, whereby the automobile worked as intended, including a known danger, but the driver or passenger did not understand the danger. An example is the passenger-side front airbag, which is dangerous to children or people under a certain weight or height.

The Second Restatement states that "in order to prevent the product from being unreasonably dangerous, the seller may be required to give directions or warnings." Significantly, the comment goes on to state that "where warning is given, the seller may reasonably assume that it will be read and heeded; and a product bearing such a warning, which is safe for use if it is followed, is not in defective condition, nor is it unreasonably dangerous." This gave automotive and other manufacturers a foothold to argue that products — such as passenger-side airbags that were dangerous to children and others below a certain height or weight — could be used safely if their warnings and instructions were followed — such as that generally provided on the reverse of the passenger-side visor — and were neither defective nor unreasonably dangerous.

The Third Restatement shifts the emphasis away from product warnings and toward safer product design. The core provision of the Third Restatement, §2, states that "a product is defective when, at the time of sale or distribution, it contains a manufacturing defect, is defective in design, or is defective because of inadequate instructions or warnings." In this instance, the Restatement is relevant to a plaintiff who had attempted to use a seatbelt in the backseat of a car but was unable to do so because of a faulty locking mechanism that was proven to have existed from the time of manufacture.

The Third Restatement goes on to define each category of strict liability separately:

• A product "contains a manufacturing defect when the product departs from its intended design even though all possible care was exercised in the preparation and marketing of the product."

• A product "contains a design defect when the foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of a reasonable alternative design by the seller or other distributor, or a predecessor in the commercial chain of distribution, and the omission of the reasonable alternative design renders the product not reasonably safe."

• A product "is defective because of inadequate instructions or warnings when the foreseeable risks of harm posed by the product could have been reduced or avoided by the provision of reasonable instructions or warnings by the seller or other distributor, or a predecessor in the commercial chain of distribution and the omission of the instructions or warnings renders the product not reasonably safe."

To prove design defect, the Third Restatement, unlike the Second Restatement, requires a plaintiff to demonstrate the existence of a reasonable alternative product design. This manufacturer-friendly provision was controversial and hotly contested.

Comment D to §2 of the Third Restatement defines reasonable alternative product design in terms of the "risk-utility balancing test." The test is "whether a reasonable alternative design would, at a reasonable cost, have reduced the foreseeable risk of harm posed by the product and, if so, whether the omission of the alternative design by the seller … rendered the product not reasonably safe."

Comment F addresses the factors relevant in determining whether the omission of a reasonable alternative design renders a product not reasonably safe. Such factors include the magnitude and probability of the foreseeable risks of harm; the instructions and warnings accompanying the product; consumer expectations regarding the product and the relative advantages of the alternative design, including its production costs, its effect on product longevity, maintenance, repair and aesthetics; and the range of consumer choice among products.

While the alternative reasonable design requirement of the Third Restatement favors manufacturers, the commentary regarding the relationship between product design and instructions and warnings does not. Comment l to §2 states:

"Reasonable design and instructions or warnings both play important roles in the production and distribution of reasonably safe products. In general, when a safer design can reasonably be implemented and risks can reasonably be designed out of a product, adoption of the safer design is required over a warning that leaves a significant residuum of such risks. For example, instructions and warnings may be ineffective because users of the product may not be adequately reached, may be likely to be inattentive or may be insufficiently motivated to follow the instructions or heed the warnings. However, when an alternative design to avoid risks cannot reasonably be implemented, adequate instructions and warnings will normally be sufficient to render the product reasonably safe. Warnings are not, however, a substitute for the provision of a reasonably safe design."

Pennsylvania products liability law is deeply rooted in the concept that the manufacturer that places a product in the commercial stream is in a better position than the consumer to take steps to reduce the risk of injury from its product or accept the costs of injuries that result from its product. The axis of products liability law has always been a cost-shifting analysis. Pennsylvania law has long required a manufacturer/seller/distributor to be liable despite the fact that it may not have been at fault. Of course, the plaintiff cannot be at fault either, because contributory negligence is inapplicable in a products liability action. The roots of strict liability require that, if there is a split between two faultless entities, the party that caused the injury, designed the product, manufactured the product, sold it and profited from it should pay for the injuries caused by the defective product.

As the Pennsylvania Supreme Court has long recognized, negligence concepts have no place in strict liability, as the court held in Azzarello v. Black Brothers, 391 A.2d 1020 (Pa. 1978), and this separation of negligence concepts from strict liability actions was reaffirmed recently by the Pennsylvania Supreme Court in Phillips v. Cricket Lighters, 841 A.2d 1000 (Pa. 2003). Such a division between negligence and strict liability is not a senseless exercise in semantics; rather, it is dictated by the very underpinnings of a strict liability action.

Certainly there are several other factors that will affect the forum to be selected. However, in analyzing the applicable law to be applied to the product, the decision to file in federal versus state court is of the utmost importance. Therefore, where the case is premised upon warning or design, the application of the Second Restatement would certainly be more beneficial to the plaintiff in proving that the product was defective. Under this rationale, the product remains on trial and the defendant is not allowed to turn the focus on its reasonable conduct. •

Michael D. Shaffer, a principal at Shaffer & Gaier, has spent 10 years trying automotive products liability cases resulting in jury verdicts, and 20 years trying other products liability cases. In addition, he has tried cases involving construction negligence, medical malpractice and premises liability. Contact him at mshaffer@shaffergaier.com.