Preemption and Products Liability: A Positive Theory

Abstract:     
In a large number of products liability lawsuits, sellers assert that plaintiffs' claims should be rejected because their products fall under some federal regulatory regime, and that the regulatory statute takes precedence over or preempts state tort law. This paper is an attempt to set out a positive theory of the doctrine on preemption of products liability claims. The federal case law is largely consistent with an approach that seeks to minimize the costs of erroneous decisions to preempt tort lawsuits. In particular, two factors explain many of the outcomes of the preemption cases in federal courts: agency independence and the degree of congruence between the regulatory and common law standards.

Number of Pages in PDF File: 44

Keywords: products liability, preemption, product safety regulation, negligence, strict liability, failure to warn, legislative intent, error costs, design defect, manufacturing defect, fraud on agency

JEL Classification: K0, K13, K41

Accepted Paper Series