By Michael Vetter, Sr., Christopher Myatt, Lance Thompson
Spicer Rudstrom PLLC
Nashville, Tennessee
Product manufacturers are afforded numerous defenses under both federal and state law. In Tennessee, as in many other states, retailers are entitled to immunity from suit for selling defective or dangerous products manufactured by others, subject to limited exceptions, provided that the retailer exercised no control or modification of the product. This is true even when the product is not technically "manufactured," but “produced.”
For instance, we recently obtained dismissal for a retail client that sold prepackaged fresh fruit that was subject to a nationwide recall for contamination. Fresh fruit, of course, is not manufactured but produced and, in this case, packaged for sale. The court found that the seller statute portion of the Tennessee Product Liability Act applied and granted immunity to the retailer since it had no control over the production and packaging of the fruit and the producer was both solvent and subject to service of process in Tennessee.
Most states’ laws are fairly similar. For easy reference/comparison, in Tennessee, sellers are not subject to a product liability action unless: (1) The seller exercised substantial control over that aspect of the design, testing, manufacture, packaging or labeling of the product that caused the alleged harm for which recovery of damages is sought; (2) Altered or modified the product, and the alteration or modification was a substantial factor in causing the harm for which recovery of damages is sought; (3) The seller gave an express warranty as defined by statute; (4) The manufacturer or distributor of the product or part in question is not subject to service of process in this state and the long-arm statutes of Tennessee do not serve as the basis for obtaining service of process; or (5) The manufacturer has been judicially declared insolvent. Tenn. Code Ann. § 29-28-106 (West)
Consideration should always be given to the role that the retailer actually plays in the design, manufacture, and preparation of the product. If uninvolved, the retailer generally will have some viable defenses. If the retailer is involved, in the design, manufacture, labeling, packaging or the like, each step moves the retailer progressively more toward being more than just a seller and toward potential liability. There are numerous cases that discuss the labeling and packaging of product and its implications.
In addition, federal trucking regulations can also potentially serve to protect product manufacturers in certain situations. Under the Federal Motor Carrier Safety Act and its regulations, a driver is ultimately responsible for the securement of cargo. Generally speaking, even when a manufacturer assists in the loading of cargo, the driver will ultimately remain responsible for its securement.
The driver of the truck bears the ultimate duty to ensure that the load is properly secured. See 49 C.F.R. § 392.9(b)(1) (“[T]he driver of a truck of truck tractor must [a]ssure himself/herself that the provisions of paragraph (a) of this section have been complied with before he/she drives that commercial motor vehicle.”). The Federal Motor Carrier Safety Administration has interpreted this to mean that “[i]t is the responsibility of the motor carrier and the driver to ensure that any cargo aboard a vehicle is properly loaded and secured.” (emphasis added)[1] In other words, the manufacturer of goods has no duty to ensure proper load securement measures.
By way of example, we recently obtained dismissal in a lawsuit where a client manufactured multi-ton coils of metal that were loaded on a flatbed trailer at the direction of the driver. The driver lost control and the cargo spilled into the roadway, causing a serious accident. While the manufacturer assisted with placing the cargo on the trailer where the driver directed, the driver strapped it down and secured the load. In dismissing the manufacturer, the court found that the manufacturer had no legal duty to secure the load since federal law placed that duty on the driver.
Similar to the above, the manufacturer is not involved or limits its involvement in the loading and shipping process, there may be some immunity. The more that the manufacturer does related to the loading and shipping of product moves the manufacturer progressively more toward potential liability.
[1] See Section § 392.9 interpretation at https://www.fmcsa.dot.gov/regulations/title49/section/392.9:
“Question 2: Does the Federal Highway Administration (FHWA) have authority to enforce the safe loading requirements against a shipper that is not the motor carrier?
Guidance: No, unless [Hazardous Material] as defined in § 172.101 are involved. It is the responsibility of the motor carrier and the driver to ensure that any cargo aboard a vehicle is properly loaded and secured.”