Products Liability Explained: Key Defense Strategies

Being served with a products liability lawsuit can be a daunting experience for any business. Allegations of a defective product causing injury or damage can threaten your company’s reputation and financial stability. However, it’s crucial to understand that Wisconsin law provides robust affirmative defenses that can protect your business. At Halling & Cayo, S.C., we have a strong track record of defending Wisconsin businesses in these complex cases. This article outlines some of the major affirmative defenses that could be pivotal in your case.

A Brief Overview: Products Liability Claims in Wisconsin

In Wisconsin, products liability lawsuits can generally be brought under theories of strict liability or negligence.

• Strict Liability: Under Wisconsin’s strict liability doctrine, as adopted and modified by the Wisconsin Supreme Court in Dippel v. Sciano, 37 Wis. 2d 443, 155 N.W.2d 55 (1967), a claimant typically needs to prove that:
  1. The product was in a defective condition when it left the possession or control of the seller.
  2. The defective condition made the product unreasonably dangerous to persons or property.
  3. The defect existed when the product left the control of the manufacturer or seller.
  4. The product reached the user or consumer without substantial change in the condition in which it was sold.
  5. The defect was a cause of the claimant’s damages. (See Wis. Stat. § 895.047(1)).
• Negligence: A plaintiff might also claim that the manufacturer or seller was negligent in the design, manufacture, or provision of warnings for the product.

Even if a plaintiff can initially present these elements, several powerful affirmative defenses can bar their claim or reduce the damages your business might face.

Major Affirmative Defenses for Wisconsin Businesses

Here are some of the key affirmative defenses that businesses in Wisconsin should be aware of when facing a products liability lawsuit:

1. Contributory/Comparative Negligence (Wis. Stat. § 895.045): Wisconsin is a modified comparative negligence state. This is arguably one of the most significant defenses in products liability cases.

   • Explanation: If the claimant (the injured party) is found to be negligent, their recovery is affected. If the claimant’s negligence is found to be greater than the negligence of the party they are suing (e.g., your company), the claimant is barred from recovering any damages. If the claimant’s negligence is not greater, their total damages are reduced proportionally to their percentage of causal negligence.
   • Application: This defense focuses on how the plaintiff’s own actions in using, misusing, or failing to take reasonable precautions contributed to their injury.
   • Relevant Law: Wis. Stat. § 895.045. The principle from Dippel v. Sciano also confirmed that contributory negligence is a defense to strict liability claims.

2. Product Misuse:

   • Explanation: If a product is used in a manner that is unforeseeable or contrary to its intended purpose and warnings, and that misuse causes the injury, the manufacturer or seller may not be liable. The key is often the foreseeability of the misuse.
   • Application: For example, using a household cleaning product for an industrial purpose it was never designed or marketed for, or using a tool in a drastically unconventional and dangerous way, could constitute misuse.

3. Substantial Change/Modification of the Product (Wis. Stat. § 895.047(1)(d)):

   • Explanation: A claimant in a strict liability case must prove the product reached them “without substantial change in the condition in which it was sold.” If the product was altered after leaving your control, and this alteration caused or contributed to the injury, this can be a complete defense.
   • Application: If safety guards were removed by the user, or if the product was significantly modified to perform a function it wasn’t designed for, this defense becomes critical.

4. Assumption of Risk (Now Assessed Under Comparative Negligence):

   • Explanation: Historically, assumption of risk was a separate defense where if a plaintiff knowingly and voluntarily confronted a known danger, they could be barred from recovery. While Wis. Stat. § 802.02(3) still lists “assumption of risk” as an affirmative defense, in practice, particularly in products liability, such conduct is now largely evaluated within Wisconsin’s comparative negligence framework (Wis. Stat. § 895.045).
   • Application: If a user discovers a defect or a dangerous condition but continues to use the product unreasonably, their knowing exposure to that risk will be a significant factor in determining their percentage of comparative negligence.

5. “Sealed Container” and Seller/Distributor Limitations (Wis. Stat. § 895.047(2)):

   • Explanation: Non-manufacturing sellers or distributors often have limited liability. A seller or distributor is generally not liable in a strict liability claim unless the manufacturer would also be liable AND one of the following applies:
     • The seller contractually assumed a manufacturer’s duty.
     • Neither the manufacturer nor its insurer can be served in Wisconsin.
     • A court determines the claimant can’t enforce a judgment against the manufacturer or its insurer.
   • Furthermore, Wis. Stat. § 895.047(3) specifically states a seller or distributor isn’t liable if they received the product in a “sealed container” and had “no reasonable opportunity to test or inspect the product” (unless the exceptions above apply).
   • Application: This is particularly relevant for retailers or distributors who simply pass along pre-packaged goods without modification.

6. Inherent Characteristics of the Product / Open and Obvious Danger (Wis. Stat. § 895.047(3)(d)):

   • Explanation: Wisconsin law states that a court shall dismiss a claimant’s action if the damage was caused by an “inherent characteristic of the product that would be recognized by an ordinary person with ordinary knowledge common to the community that uses or consumes the product.” Separately, the “open and obvious danger” rule suggests that there is no duty to warn against dangers that are plain, commonly known, or obvious to the user. While the latter is often incorporated into the comparative negligence analysis, the statutory provision for “inherent characteristics” offers a direct path to dismissal.
   • Application: For products with known risks that are integral to their function (e.g., a sharp knife is inherently sharp), this defense can be invoked.
   • Relevant Law: Wis. Stat. § 895.047(3)(d).

7. Compliance with Governmental or Industry Standards:

   • Explanation: While not always an absolute defense on its own, demonstrating that a product complied with applicable government regulations or industry standards can be strong evidence that the product was not defective or that the manufacturer exercised reasonable care.
   • Application: Evidence of compliance can support arguments that the product design was safe, warnings were adequate, or manufacturing processes were appropriate.

8. Federal Preemption:

   • Explanation: In certain limited circumstances, federal law governing the design, manufacturing, or labeling of specific products (e.g., certain medical devices, pharmaceuticals, or motor vehicles) can preempt state products liability claims. If a comprehensive federal regulatory scheme is in place, it may bar state law tort claims.
   • Application: This defense is highly technical and product-specific, requiring a careful analysis of the relevant federal statutes and regulations.

The Critical Role of Experienced Legal Counsel

Navigating the complexities of a products liability lawsuit and effectively asserting these affirmative defenses requires a deep understanding of Wisconsin law and extensive litigation experience. The specific facts of your case will determine which defenses are most viable and how they should be strategically presented.

The business litigation attorneys at Halling & Cayo, S.C., we are committed to providing robust defense for businesses facing these challenging claims. We meticulously analyze every aspect of the case, from the product’s design and manufacture to its use and the circumstances of the alleged injury, to build the strongest possible defense. If your business has been sued or is facing the threat of a products liability lawsuit in Wisconsin, it is crucial to act promptly and secure knowledgeable legal representation. Understanding and leveraging the affirmative defenses available under Wisconsin law can make all the difference in the outcome of your case.