For 10 years, there were no jury verdicts of $1 billion or more in cases involving defective products. In 2014, that trend stopped with several verdicts exceeding that total. Some have tied the absence of large verdicts from 2004 to last year to extensive lobbying efforts by "tort reform" groups. Others suggest that the gap was due to the settlement of the major class action lawsuits against the tobacco industry. Whatever the reason, the return of larger jury verdicts has an impact on the makers of consumer goods and the victims of injuries and illnesses caused by product defects.
The largest jury verdicts generally include punitive damages. Punitive damages are not necessarily dependent on the amount of financial harm done to the plaintiff by a defective product. They are intended to penalize the defendant and deter them from engaging in similar conduct in the future. These damages are often a major factor in civil litigation concerning defective and dangerous products.
The return of larger jury awards coincided with a record number of motor vehicles recalled for safety defects. Accusations of delay and obfuscation attended the controversies over defective ignition switches in General Motor's vehicles and vehicles containing Takata airbags. Both defects have been tied to a number of fatal car accidents. Evidence of both defects appeared long before the affected vehicles were recalled.
Product liability cases are often complex. Defective product claims require thorough investigation and a full understanding of the chain of production for the product. Larger jury verdicts increase the risk a company runs in allowing a defective product to reach consumers.
Source: Insurance Journal, "Large Product Liability Awards Made Comeback in 2014," by Margaret Cronin, 19 February 2015