Beyond Market Share Liability: A Theory of Proportional Share Liability for Nonfungible Products

Abstract:     
Twenty-five years have passed since courts first adopted market share liability, a theory under which a plaintiff unable to identify the manufacturer of the product that caused his injury can recover on a proportional basis from each manufacturer that might have made the product. Courts have severely restricted the reach of this potentially powerful theory by insisting that it can apply only to products that are perfectly fungible. Most products vary from manufacturer to manufacturer, posing different levels of risk, and therefore do not satisfy the fungibility requirement. As a result, courts have applied market share liability to a very small number of products.

This Article argues that courts should eliminate the fungibility requirement by recognizing that market share liability is just one variant of a broader concept that the author calls proportional share liability. Rather than deny recovery in cases involving products that pose varying degrees of danger, courts should consider whether proportional share liability can be imposed by using information other than market share data to make a reasonable and fair allocation of liability among the defendants. This Article examines the potential application of proportional share liability in a wide variety of contexts, including vaccines or lead paint causing brain damage, violence fueled by negligent distribution and sales of firearms, disease resulting from exposure to asbestos or tobacco, and damage to spacecraft from collisions with orbital debris.

Keywords: Market share liability, Product liability, Proportional basis, Fungible, Nonfungible, Proportional share liability, Manufacturer, Liability, Harm, Injury, Market share, Manufacturing defects, DES, Guns, Tobacco, Asbestos, Lead paint, Orbital debris, Vaccines

JEL Classifications: K10, K13, K23, K40

Accepted Paper Series