An increasing body of litigation claiming damages for the effects of manufactured products.
Among the recent cases are the lawsuits brought in the United States against the manufacturers of the fuel additive MTBE. Those cases have given rise to some interesting problems of causation, the liability of individual manufacturers being ascertained by reference to the amount of harmful product which each released into the stream of commerce. A manufacturer with an historic 10% market share now faces the prospect of liability for 10% of the total harm.
A similar approach has been advocated in numerous lawsuits against the petrochemical and energy industries for causing climate change. In Lliyuya v RWE, a German case, the claimant Peruvian farmer seeks to hold a German energy company liable for 0.47% of his losses arising from the melting of a local glacier, on the basis of the company’s alleged contribution to global greenhouse gas emissions.
The PFOA/PFOS litigation in the United States gives rise to a slightly different problem. In that case the primary polluter was the US Military, which specified a firefighting foam and used it in military exercises over several decades. PFOA and PFOS chemicals accumulated in the water table, affecting municipal water supplies. As the US Military enjoys immunity from suit, numerous lawsuits have been filed against the corporations which manufactured the product. Again attribution theory forms the basis of the claim.
Where will the trend of environmental product liability litigation lead? One possibility is towards the manufacturers of plastics. The environmental accumulation of plastics, such as microbeads, cups, straws and bags, now attracts daily media interest. In November 2018 it was reported that a whale washed up on the Indonesian coast with 6kg of plastic waste in its stomach. Microbeads were banned in July 2018 for their environmental effects, and those effects might now become the subject of future claims. We believe that plastics manufacturers are at significant risk of future litigation based upon attribution theories which have been developed elsewhere.
Environmental product liability litigation is a trend which shows no sign of abating.
You can read the rest of our insurance predictions here.