“Libertarian” Products Liability?

20Mar09

A friend of a friend who recently held out for regulation-free hiring in said friend’s blog comments has got me thinking. No-regulations libertarian-ish-ism sounds great when you’re nineteen, but would it work in my world today?

The following example is taken from a case I’m currently working on. It’s a good vehicle for the discussion not only because it actually happens, but because it’s an utterly basic issue.

You are a steel fabricator. For twelve to sixteen hours a day, you engineer, measure, cut, and/or put together steel doowackies – shelves, buildings, cogs, whatever you like. In order to do this, of course, you need raw materials; namely, steel. You also need the means to move the steel around your plant – from off the trucks it arrives on, to storage, to the cutting tables, and so forth. Steel can be pretty dang heavy, so you decide you’re going to buy some nylon slings, so you can pick your steel up with a hoist and move it around the plant.

I am a nylon sling manufacturer. Since I want your business, I have sent you a catalog. Deciding that you want to buy my slings, you sit down and look at my catalog. Since my prices are the lowest around, you give me a call, and I send you a box of slings.

What you don’t know is that my prices are so low because I purposely manufacture and sell defective slings. The slings I send you look, sound, taste and feel just like any other manufacturer’s slings. The only difference is that, where other manufacturers have used webbing and sewing techniques that will actually stand up to repeated use, I have used defective webbing and sewing that will only take about a half-dozen lifts before snapping. The only way for you to know that I have used defective webbing and sewing is to take apart the sling, which you don’t do. Taking apart the sling will destroy it, and you want to use it to lift your steel. After all, that’s why you bought it.

So you start using your slings. For the first couple days, they work great. Then, one morning as you’re unloading a truck, the sling you’re using breaks, dropping several hundred pounds of steel onto you. You’re pinned to the floor. Other workers rush over and take the steel off you, but you’ve got a broken leg, a broken wrist, broken ribs, and a concussion.

Now that the sling is broken, it’s pretty easy for you to have a look at its insides, and when you do you realize right away that I’ve sold you a defective product. Thanks to that, you have no slings, so work in your plant slows to a crawl because it takes your workers so long to move the steel by hand. You have to refuse several large and very lucrative projects because you cannot move steel in the sizes those projects require. On a personal note, you have several thousand dollars’ worth of medical bills. You also have a permanent limp and chronic pain that has forced you to stop working, costing you and your company the money you would have made if you were still healthy. None of this would have happened if I had not sold you a defective sling. What are you going to do?

Like most Americans, you’re probably inclined to sue me blind at this point. And we’ll assume, for the sake of argument, that the prohibition on public regulation of private behavior has not put the courts out of business, so you actually can file that complaint. What are you going to allege?

The facts are pretty simple: “Plaintiff, Guy Who Makes Crappy Slings, sold me a sling. The sling broke, dropping steel on my head. Now I am permanently disabled and my business is operating at minimum capacity.” So is the prayer for relief: “Make the jerkwad who sold me the crap sling give me money.” No change from the thousands of products liability claims that are filed every day.

(Okay, we don’t typically use the words “jerkwad” or “crap” in court filings. But we could. And you get my point.)

Now comes the fun part. How are you going to prove you deserve my money?

Under our current private-behavior-regulating system, you can prove you deserve my money if you prove:

(1) that I owed you a duty to make and sell a sling that wouldn’t cause steel to fall on your head when you used it in the way it is supposed to be used (and we’ll assume you did use it correctly);
(2) that I somehow failed to do that, possibly by manufacturing a sling I knew wouldn’t do what I said it would;
(3) that but for my selling you a sling that didn’t do what it was supposed to, you would not
(4) be crippled for life.

Currently, the duty that typically pops up in negligence cases is “reasonable care,” or the duty, basically, to pay attention to what you’re doing and what other people will do, and not to be a total fumblefuck. Pretty much everybody has a duty of reasonable care to pretty much everybody else pretty much all the time, and we tend to agree, without really thinking about it, that it’s a good duty for people to have to one another.

In Regulation-Free World, however, there are no duties. Which means that, when I sold you that sling, I had absolutely NO responsibility to you when I did it. I could make my sling with crappy materials. I could sell it to you without telling you it would break in the first week. There’s no way for you to invoke the public power (say, through the courts) to make me behave myself, because there is no public regulation of private behavior. No one has the power to make me behave except my own self-interest.

But, you say, that’s crazy. Rational people wouldn’t assume they had no duty to one another!

I’m having a flashback to Rwanda as you speak, but let’s assume you’re right, and that even in Regulation-Free World everyone recognizes that you really shouldn’t fuck over your fellow man like that. So we agree that I have a duty not to make a defective sling. Score one for you.

Now I stand up in court. And I argue that, yes, we all know I have a duty to make a non-defective sling. But, I say, I did that: this sling is not defective. You wanted it to lift steel, and it did that.

That, as we all know, is complete bollocks. So what are you going to say to prove that I’m full of it?

To prove the sling is defective, you might compare it, say, to another company’s slings. But that doesn’t prove the sling I made is defective; it just proves that another company makes a better sling. Maybe you should have bought it from them instead. Caveat emptor.

You might compare my sling to the slings made by every other company on the market (assuming I have competition). Still, this doesn’t prove that my sling is defective; it just proves that everyone makes a better sling than I do. Maybe I should be out of business. Caveat venditor.

You might even argue that everyone knows slings should be made in X way to prevent them dropping their loads on people’s heads, and that my sling, which is made Y way, doesn’t do that. In a regulation-free world, this is as close as you can get to arguing what saves plaintiffs’ asses in products liability cases on a daily basis: that the product was defective because it failed to meet standards. “But everyone knows” is a close argument, but not close enough. “Everyone,” after all, isn’t an authority. Without some kind of uniform regulation, there is no authority on the defectiveness of slings. And without that baseline, you can’t prove I failed when I made you a crappy sling.

“But wait!” you say. “If the sling was supposed to hold up the steel, and it broke, then obviously something was wrong with it! Obviously someone screwed up!”

In law, we call this res ipsa loquitur, which is fancypants psuedo-Latin for “the thing speaks for itself.” It’s the common-sense idea that some things are just so completely “out there” that, for them to happen, someone MUST have screwed up.

But how are you going to establish that I screwed this one up? After all, even the best nylon sling on the market is not infinitely strong, and even in an ideal world I’m sure we agree that there is no duty to create an infinitely unbreakable sling. Every sling is going to break sometime. Without some kind of baseline, you’re never going to prove that it wasn’t this sling’s “time to go.”

“Well, then, fuckit,” you say. “I’ll just enjoy telling all my friends how much your product sucks and I’ll put you out of business. Viva la free market!”

Which isn’t a bad plan. Except that, without government regulation, I may very well have no competition – I may have bought or stomped them all and turned myself into Monopoly Sling Co., your one and only source of nylon slings.

Or perhaps I still have “competition,” but in order to keep costs down and profits high, we have agreed amongst ourselves to charge as much as we can get away with while manufacturing the least-durable product possible that will still make it to the end user in one piece.

Or perhaps I have actual competition – competition who watched this case with much interest, thinking that surely I, their low-priced competitor, would be eaten alive in court. When this didn’t happen, they learned, hey, we can save money by skimping on materials, and no one will hold us accountable! Suddenly, you can’t get a better sling anywhere. It’s a giant race to the bottom.

What are you going to do? You can’t not buy slings, because without them your business doesn’t move enough steel in a week to keep its doors open. You can’t make your own slings, because you don’t have the equipment or the expertise, and in any case if your guys spend all day sewing slings, they’re moving even less steel and are even less likely to make enough to keep your business afloat.

You consider switching to chains, but the landmark case of Your Neighbor v. Guy Who Makes Crappy Chains made it clear that you can’t prove a chain is defective any more than you can prove a sling is, and in any case, you can’t get chains from anyone other than Consolidated Amalgamated Chains Inc. Making your own is more feasible than making your own straps, but again, it might put you out of business.

Unless you went into business making superior-quality chains. Which could hold you up for a while, till the thugs from Consolidated throw a pipe bomb through your factory windows. Who’s going to stop them? There is no government regulation of private market behavior, remember. It’s not arson, it’s just good business!

“Oh, come ON,” you say. “This post is quite long enough without you stuffing it with hyperbole!”

Well, yeah. But here’s the short version. Public regulation of private behavior is necessary to the operation of any cohesive society. There is no such thing as a truly free-market system for a reason. Every time you advocate for a world free of regulation, just remember: you could be the guy who got squashed by the steel.

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