How to Avoid Product Liability Claims: Effective Risk Management Strategies

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How to Avoid Product Liability Claims:

Effective Risk Management StrategiesKOWIT SOMWAIYAManaging Partner

PRODUCT LIABILITI LAW, RISK & CRISISPROACTIVE STRATEGIES & PREVENTIVE MEASURES

OMEGA WORLDCLASSSHERATON GRANDE SUKHUMVIT HOTEL

27 NOVEMBER 2015

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Presentation Topics

• Overview of PL Risks• Burden of Proofs in Product Liability Claims• How to Develop and Implement a Plan to Reduce Product

Liability Risks • How to Avoid Product Liability Claims• Case Study from Claims in Thailand and Abroad

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Overview of PL Risks: Unsafe Products (1)

• Defect in manufacturing- failure to conform to the original formula/process

- use of flaw components

- improper workmanship

- contamination from components, at manufacturing process, during transportation, etc.

• Defect in design- failure to confirm to the industry standard

- improper formula/process

- defective packing design

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Overview of PL Risks: Unsafe Products (2)

• Lack of Instruction on Consumption/Usage and Storage- Consumption quantity

- Age, allergy and pregnancy of consumer

- Storage temperature, refrigeration

• Lack of Warning- no warning on potential danger or side effects

- insufficient warning on potential danger or side effects

- Insufficient information on ingredients/components

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Overview of PL Risks: Who is liable? (3)

“Business Operators”• manufacturer

• importer

• seller who cannot indentify the manufacturer or the importer

• owner of the trademark

• any person holding himself out as the manufacturer or the importer of the unsafe product

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Overview of PL Risks: Injuries and Liabilities (4)

Injuries from Unsafe Products• injury to life, body and health

• injury to mind (mental anguish, anxiety, grief, humiliation or similar mental injury)

• injury to property other than the unsafe product

Liabilities of Business Operators• unsafe product caused injury to consumers

• regardless of willful act or negligence (Strict Liabilities)

• all business operators involved are liable jointly and severally

• Actual damages, punitive damages

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Burden of Proofs in Product Liability Claims

• Person who can file a claim:-- consumers

- the Consumer Protection Board

- Associations or foundations for protection of consumers

• Merely claim that the product caused injury.• Burden of proof is on the business operators (Strict Liability).• Must prove that:-- the product and its design, manufacture, ingredients and components are safe

- injured person consumed the product knowingly that it was unsafe

- injured person failed to comply with the instructions on consumption and storage and the warning on danger and side effects

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How to Develop and Implement a Plan to Reduce Product Liability Risks (1)

• Label of the products should state clearly on:-- manufacturer / importer

- manufacturing date / expiry date

- ingredients

- details of the products

- warning on possible damages (not in a form of limitation liability in all aspects)

If they are in English, they should be translated into Thai.

• Avoiding unreal advertisement (The advertisement should be based on the facts)

• Controlling standard of the products• Fully comply with the applicable laws and regulations on manufacturing

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How to Develop and Implement a Plan to Reduce Product Liability Risks (2)

• Having proper storage of products before selling them to customers

• Keeping records or reports of manufacturing so that they can be proved to the Court

• Providing customer services or a call center for customers to report the defects of the products

• Recalling the products immediately if they were found unsafe• Having an insurance with insurance companies

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Disclaimer

• The information provided in this newsletter is general in nature and may not apply to any specific situation. Specific advice should be sought before taking any action based on the information provided. Under no circumstances shall LawPlus Ltd. or any of its directors, partners and lawyers be liable for any direct or indirect, incidental or consequential loss or damage that results from the use of or the reliance upon the information contained in this newsletter. Copyright © 2016 LawPlus Ltd.

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