Wednesday, August 18, 2010
SC Adopts Risk-Utility As Sole Test in Design Defect Cases, Also on Post-Distribution Evidence and Punitive Damages
In an opinion filed on Monday, the South Carolina Supreme Court adopted the risk-utility test for design defect cases, rejecting use of a consumer expectations test. Under the risk-utility test, the court held that the plaintiff was required to present evidence of a reasonable alternative design that would have prevented the product from being unreasonably dangerous.
The court further held that "the use of post-distribution evidence to evaluate a product's design through the lens of hindsight is improper."
And finally, as to punitive damages, the court considered what financial evidence is proper in assessing punitive damages. Recognizing that the U.S. Supreme Court has not spoken on this issue, the court adopted a cautious approach, holding that only the defendant's net worth could be introduced. Applying this standard, the court found that evidence concerning the salaries and compensation of the defendant's officers was improper.
Thanks to William Gaskill for the case alert.