In most product liability lawsuits, the plaintiff will sue under theories of negligence and strict liability. In such cases, the plaintiff may allege that the product’s manufacturer was negligent or that the product was “defective” for failure to include available safety devices that would have prevented the accident. Because negligence claims focus on whether the manufacturer acted “reasonably” when it designed the product at issue in the case, the manufacturer is allowed to present evidence comparing the product with those of competitors. For example, the manufacturer can introduce evidence showing that the industry custom & practice was not to include such safety devices. To preclude such evidence of industry custom & practice, plaintiffs typically drop negligence claims on the eve of trial and, instead, only try the case on a theory of strict liability – design defect (under either the “consumer expectations test” or “risk/benefit test”).
In a recent opinion from the Court of Appeal for the State of California, Second Appellate District, the court ruled that evidence of industry custom & practice may be admissible under some circumstances in a strict products liability case.
In Kim v. Toyota Motor Corp., plaintiffs claimed that their Toyota Tundra was defective for failing to incorporate an electronic stability control system (ESC). By motion in limine, plaintiffs sought to preclude any evidence “comparing the Tundra to competitors’ vehicles and designs.” The court denied the motion and the jury ultimately found that the Toyota Tundra did not have a design defect.
Plaintiffs moved for a new trial, which was denied. They then appealed, arguing that the trial court erred by allowing Toyota to introduce evidence comparing the Tundra with trucks made by its competitors, which also did not have ESC. The plaintiffs argued that evidence of “industry custom & practice is irrelevant, unduly prejudicial, and inadmissible as a matter of law in a strict liability action.”
In finding that industry standards may be admitted as evidence in a strict products liability case, the Second District Court of Appeal panel broke with a line of similar cases that held that evidence of industry standards and practice is always inadmissible. In its conclusion, the court found that the trial court has discretion to determine what is admissible in a strict products liability action “depending on the nature of the evidence and the purpose for which the party seeking admission offers the evidence.” The court explained that industry custom & practice was important evidence for the jury to consider:
“Industry custom may reflect legitimate, independent research and practical experience regarding the appropriate balance of product safety, cost and functionality. The parties in a strict products liability action probably will dispute whether and to what extent industry custom actually reflects such considerations and whether it strikes the appropriate balance. But that does not make the evidence inadmissible. Evidence of compliance with industry custom may tend to show that a product is safe for its foreseeable uses, while evidence of noncompliance with industry custom may tend to show that a product is unsafe for its foreseeable uses.”
It should be noted that the holding in Kim involved only the risk/benefit test for strict products liability, which is typically used where the alleged defect is extremely complex such that an ordinary consumer would not know what to expect about the safety of the design. The trial judge had expressly precluded use of the consumer expectations test for strict liability, which is preferred by plaintiffs because it allows jurors to determine whether the design was safe even without the benefit of expert testimony. Thus, plaintiffs may argue that Kim stands for the proposition that evidence of custom & practice may be available in some risk/benefit cases, but does not support the proposition that such evidence is admissible in any consumer expectations case. This is another reason why plaintiffs will continue to pursue application of the consumer expectations test and oppose use of the risk/benefit test in California product liability litigation.