Rollover Economics: Arbitrary and Capricious Product Liability Regimes

Another jury verdict, another arbitrary multimillion-dollar award. Unbounded noneconomic damages are distorting the legal system by undermining constitutional and legal caps on punitive damages and by encouraging plaintiffs’ lawyers to pursue cases of questionable merit. The problem is exacerbated by evidentiary rules that emphasize gamesmanship over truth. Noneconomic damages should be capped and objective safety standards established in order to provide a safe harbor for manufacturers from unfair liability.

It went generally unnoticed last November when the California Supreme Court refused to review an intermediate court’s decision in Buell-Wilson v. Ford Motor Co. But then again, it went generally unnoticed when a jury awarded an arbitrary $368 million in damages in that case, when the trial judge reduced that verdict to an arbitrary $150 million judgment, and when an intermediate appellate court reduced that figure to an arbitrary $82.6 million (which, with interest, works out to over $100 million). Products liability verdicts have become so run-of-the-mill that even nine-digit verdicts and their aftermath receive only local or specialty press coverage, with cursory national coverage. But Buell-Wilson demonstrates much that is wrong with the current liability regime, including the fact that the media is so jaded by litigation abuse that a $368 million verdict is barely newsworthy.