A study by The American Association for Justice shows that eighty-three percent (83%) of the recalls announced by The Consumer Product Safety Commission (CPSC) in 2009 were from foreign manufacturers. The results for 2008 were similar. What happens when one of these defective foreign-made products injures someone?
Recent litigation concerning defective Chinese drywall highlights the problems with holding foreign manufacturers accountable for injuries their products inflict upon the public. Millions of tons of defective Chinese drywall were imported into the United States for use in the construction of homes. After these homes were built, owners began complaining the drywall emitted corrosive and irritating fumes. The CPSC studied the issue and issued a press statement in November 2009. According to the press release, the CPSC found:
[A] strong association between homes with the problem drywall and the levels of hydrogen sulfide in those homes and corrosion of metals in those homes.
Defective drywall was emitting hydrogen sulfide gas. The gas caused these homes to smell. The gas also caused parts of the home to corrode and deteriorate. The CPSC is continuing to study the health issues which may be associated with the defective drywall.
Last week, a Federal Judge in Louisiana assessed $2.6 million in damages against a Chinese state-owned manufacturer of this defective drywall on behalf of seven Virginia families. These damages relate only to the costs necessary to remediate the problem and fix the damaged homes of these plaintiffs, not the potential health risks. Many other damaged homeowners have also filed claims which remain pending.
The problem arises in the enforcement of the Court’s judgment. Will the foreign manufacturer truly be held accountable or is this a judgment that will never be collected? The Wall Street Journal published a great article discussing the case and its history. In this litigation, the Chinese manufacturer never even answered the lawsuit. Think about that, the defendant refused to respect our judicial system. While the Court’s ruling on the initial drywall claim is a positive step, it remains unclear whether the foreign drywall manufacturer that caused this harm will ultimately pay for the damages it created.
Foreign manufacturers are often able to avoid liability. How?
- Difficulties obtaining legal service on the company in its home country
- Issues related to whether the U.S. Court has jurisdiction over the foreign manufacturer
- Problems collecting any judgment
The costs of an injury, disability or death are real. Somebody will suffer the costs. Will it be the innocent families who used the product? Will it be taxpayers? When any manufacturer avoids accountability for its dangerous products, we all bear the costs. Foreign manufacturers possess additional loopholes to avoid responsibility. Is that fair to anyone? If a foreign manufacturer avoids its responsibility, then the innocent consumer, our government, or a domestic company that distributed the product, will ultimately bear the loss.
In February, several members of the U.S. House of Representatives introduced legislation to make it easier to hold foreign manufacturers accountable for their defective products. The American Association for Justice issued a press release detailing some of the problems under current law as well as solutions presented by the proposed legislation. Among other things, the proposed legislation would require foreign corporations to have an “agent” in the United States to accept service of process for civil and regulatory claims. The proposed legislation would also require the manufacturer to consent to jurisdiction in our courts. If a company produces products for sale in our country, it should be subject to the jurisdiction of our courts. This is much needed legislation that will hopefully protect consumers in the future. We should expect safe products.
The Blackwell Law Firm represents people with serious personal injuries across Alabama. We help people injured from a defective product. Many of these cases involve bad drugs or dangerous medical devices. If you have questions, let us know. We are happy to provide information.