October 2006

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

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Products Liability

Inconsistent ATV Defect Verdicts Mandated New Trial
Inconsistent verdicts concerning the negligence of a vehicle manufacturer and the defectiveness of its product mandated a new trial, the U.S. Court of Appeals for the Second Circuit determined. An all-terrain vehicle (ATV) owner was left paraplegic when his ATV flipped over while loading it onto a trailer. The ATV owner brought negligent design and failure-to-warn claims against the ATV's manufacturer, resulting in a $2.2 million damage award. The court determined that the jury's verdicts were inconsistent and that a new trial should be granted, reasoning that a verdict of negligent conduct without a resulting defective product undermined the causal connection between the negligence and the product-related injury (Kosmynka v. Polaris Indus., Inc., 2d Cir., CCH Products Liability Reports ¶17,532).

Medicaid/Medicare Liens Addressed in Zyprexa Mass Tort Context
A series of agreements were reached among a group of 8,000 Zyprexa plaintiffs, the federal government, and 23 states to resolve outstanding Medicare and Medicaid liens on the plaintiffs’ recovery from their product claims involving the antipsychotic drug. The U.S. District Court for the Eastern District of New York, which oversaw the lien agreement, praised the use of a statistical model in place of case-by-case reviews to determine the amount of each lien. In addition, the court mandated that each state reduce its lien based on the plaintiffs’ legal costs (In re Zypreza Prods. Liab. Litig., ED N.Y., CCH Products Liability Reports ¶17,534).

High Economic/Non-Economic Award Ratio Irrelevant to Reduction of Damages Issue
The high ratio between an injured worker's economic damages and non-economic damages was not, by itself, sufficient to justify remittitur of a jury's award a Missouri appeals court ruled. A worker was seriously injured when the battery of the front-end loader that he was operating exploded due to a defect in its battery. The manufacturer of the machine appealed the jury's $2.5 million compensatory award, arguing that the ratio between the award and the worker’s $14,530.31 economic damage award was excessive. The court held that the ratio was irrelevant and that, as long as, the total award was justified by the worker’s injury it was not excessive (Knifong v. Caterpillar, Inc., Mo. Ct. App., CCH Products Liability Reports ¶17,538).

Consumer Product Safety

Electronic Stability Control Standard Proposed
A proposal to establish a new Federal Motor Vehicle Safety Standard would require all manufacturers to equip passenger cars and other vehicles with electronic stability control (ESC) as a standard feature. ESC systems use automatic computer-controlled braking of individual wheels to help drivers maintain control in situations where vehicles without ESC would skid out of control and likely leave the road—the circumstances that lead to most rollovers. Based on crash data studies conducted by the National Highway Traffic Safety Administration (NHTSA), installation of ESC systems would reduce single vehicle crashes of passenger cars by an estimated 34 percent and single vehicle crashes of sport utility vehicles by an estimated 59 percent. NHTSA believes that ESC systems thus present the highest life-saving potential of any vehicle safety device developed in the past three decades (CCH Consumer Product Safety Guide ¶40,700).

Safety Ratings Required on New Car Window Stickers
Manufacturers will be required to display the government's safety ratings on new vehicles beginning with the 2008 model year, under a final rule issued by the NHTSA. The rule requires window stickers to provide safety rating information about the vehicles, in order that consumers can evaluate the vehicles' safety based upon the number of stars on the sticker. The new vehicle price stickers will contain NHTSA safety ratings in three areas—front and side crash tests and non-destructive rollover tests. Each test uses the five-star rating system, with five stars indicating the greatest safety. If a vehicle has not been tested by the agency or safety ratings have not been assigned, a statement to that effect in the appropriate rating category must be included. Finally, ratings must be placed on new vehicles manufactured 30 or more days after notification to the manufacturer by NHTSA of ratings for those vehicles (CCH Consumer Product Safety Guide ¶41,951).

CPSC Launches Major Campaign to Reduct ATV-Related Injuries
The Consumer Product Safety Commission announced a major campaign to education riders of all ages on the safe use of ATVs using television and radio messages; a website for riders, parents, trainers, local and state officials and the media; and a partnership with organizations and officials dedicated to promoting ATV safety. According to the CPSC, from 1982 to 2004, there were nearly 6,500 deaths involving ATVs. In 2004 alone, an estimated 136,000 people were treated in hospital emergency rooms for ATV-related injuries. About 30 percent of all deaths and injuries involve children younger than age 16. (CCH Consumer Product Safety Guide, No. 876, Oct. 6, 2006).