Is a product manufacturer that complies with federally adopted standards liable for damages under Texas’s statutory product liability law? The Texas Supreme Court in American Honda Motor Company, Inc. v. Milburn, recently addressed a product liability case in which the main issues on appeal was whether Honda defectively designed a seatbelt system that caused severe injuries to Sarah Milburn and whether Texas’s product liability statute, contained in Chapter 82 of the Texas Civil Practice and Remedies Code Section 82.008, shielded Honda from liability.

Section 82.008 entitles a product manufacturer to a presumption that it is not liable for injuries caused by its product’s design if the manufacturer establishes that (1) the design complied with mandatory federal safety standards or regulations, (2) the standards or regulations were applicable to the product at the time of manufacture, and (3) the standards or regulations governed the product risk that allegedly caused the harm.

Honda designed a new ceiling-mounted detachable anchor seat belt system for the third-row middle seat of the 2011 Honda Odyssey. In November 2015, an Uber driver picked up Milburn and her friends in a 2011 Honda Odyssey. Milburn sat in the third-row middle seat and used the ceiling-mounted seat belt to buckle herself in. An accident caused the van to overturn on its roof. Milburn hung upside down by the shoulder strap portion of her seat belt, causing quadriplegia paralysis.

Milburn sued and settled with all defendants but Honda. Milburn asserted claims against Honda for negligence in designing, manufacturing, and marketing the van’s third-row middle seat belt system. Milburn alleged that the seat belt system was defective and dangerous and its intended method of use was counterintuitive. The jury found that Honda negligently designed the defective seat belt system and placed 63% of the responsibility for the accident on Honda and awarded $37 million. The jury also found that Honda was entitled to the Section 82.008(a) presumption of nonliability, but the jury also found that that those standards or regulations were “inadequate to protect the public from unreasonable risks of injury or damage,” meaning Milburn rebutted that presumption Section 82.008(b).

The court of appeals affirmed the jury verdict, holding that Honda was entitled to the presumption of nonliability but that Milburn rebutted it and that based on the record Milburn’s experts had provided evidence that the detachable anchor seat belt system was defectively designed, and a safer alternative exists.

Honda petitioned the Supreme Court for review, arguing that Milburn was required, but failed, to present sufficient expert testimony to rebut Section 82.008’s presumption of nonliability on regulatory inadequacy grounds. The Court explained there are two things Milburn must prove (1) that the product was defective and (2) that the applicable federal safety standard was inadequate to protect the public from unreasonable risks of injury, which requires something other than proof of a product’s defective design—that is, something more than a conclusion that the risks outweighed the benefits with respect to the particular product design at issue.

A majority of the Supreme Court held that Milburn’s experts did not properly rebut the presumption of non-liability and prove that the federal safety standards did not adequately protect the public from an unreasonably dangerous product. The experts did not properly review the federal governments risk and safety analysis in adopting the federal regulation. The Court held that Milburn’s experts simply disagreed with the federal standard but failed to establish the standards failed to protect the general public.  A minority of the Court would have found that it was within the jury’s purview to decide whether the federal standards were sufficient and because the jury found they were not sufficient the jury verdict should be affirmed.

The Supreme Court’s ruling underscores the need for experts to extensively review how the federal safety standards are adopted and establish that the federal government failed to perform the proper risk analysis.  It will not be sufficient to just prove that a product is unreasonably dangerous.

The attorneys in our Austin and Dallas office have extensive experience litigating product liability claims and representing manufacturers of construction materials. If you should have any questions about Chapter 82 please contact us at info@gstexlaw.com.

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