Is it Risky for Businesses to Cater to COVID-19 Needs?
With businesses across the United States facing pandemic challenges, many companies have begun selling items that they were not originally known for prior to the onslaught of COVID-19. For instance, clothing companies have started to sell face masks, and some breweries and distilleries began using their equipment to make hand sanitizer. Some automakers switched to the production of respirators and ventilators. This raises the question of whether these companies could face product liability lawsuits as a result of their new ventures.
Watch the YouTube Video of a news report on distilleries and breweries helping out by creating hand sanitizer.
Limited Federal Protection from Liability
There are some protections within the Public Readiness and Emergency Preparedness (PREP) Act and the Defense Production Act (DPA), which may shield some of the manufacturers from tort and contractual liability. However, the statues are not clear-cut, and they lack predictability given the very dramatic nature of the manufacturing shifts that businesses throughout the country have made over the past months. Consumers and manufacturers both could benefit from supplemental regulations that include “safe harbor” language with warnings and instructions. An example would be a disclaimer regarding the effectiveness of certain kinds of personal protective equipment (PPE) with regard to catching or spreading COVID-19.
Historical and Current Use of the DPA
The DPA was passed by the United States government during the Korean War. It was partly intended to give incentives to private companies to reconfigure and help with defense production. The DPA was invoked by the federal government on March 18, 2020, in order to help meet the nation’s needs in the fight against COVID-19. To date, the DPA has been employed to direct some manufacturers to make ventilators, to block the export of N95 respirators, and to regain medical supplies that were being stockpiled by private individuals.
The DPA has a provision that companies are not liable for contractual damages that result from putting aside other obligations in order to meet an order or demand that falls under the DPA. While there is no provision within the DPA that protects the company from tort liability, the PREP Act gives certain (not all) manufacturers limited immunity from tort and contract liability.
Safe Harbor Could be Additional Protection
While the PREP and DPA acts give some protection to manufacturers that are responding to the heightened demand for supplies to fight COVID-19, more regulations and laws that focus on “safe harbor” warnings would offer another measure of security to manufacturers as well as to consumers. California’s Proposition 65, for example, regulates warnings for toxic chemicals. It permits companies to employ a “safe harbor” warning on products. The correct usage of a Prop 65 warning protects companies from actions of government enforcement, thereby also reducing the risk of private lawsuits. In the context of COVID-19, a “safe harbor” warning regulation for manufacturers could lend some additional peace of mind to both manufacturers and consumers. Manufacturers that used a COVID-19 “safe harbor” warning, such as with regard to the effectiveness of a certain type of PPE, for example, would have some added protection from liability. At the same time, consumers would gain more understanding of the benefits and limitations of those PPE products.
Products Liability Lawyer in Elk Grove
Thanks for reading – I’m Ed Smith, an Elk Grove products liability lawyer. Product liability lawsuits arise when consumers are injured or harmed by the use of a defective product. If you have been injured or otherwise harmed as a result of your use of a defective or hazardous product, do not hesitate to call my office for free, friendly legal advice at (916) 921-6400. Our toll-free phone number is (800) 404-5400.
Throughout Elk Grove, and all of Northern California, I have diligently advocated on behalf of those injured due to their use of dangerous products for close to 40 years.
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Photo Attribution: https://pixabay.com/photos/factory-beer-production-brewery-1518504/
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