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Product Liability: Are You Covered?

By Patty Schmucker
Posted: May 23, 2008, from the July 2007 issue of Skin Inc. magazine.

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If you are creating your own brand, you can learn about your legal requirements as a manufacturer and distributor through organizations such as ICMAD. These associations also can assist you in keeping up with ever-changing state laws.

Serving your clients

Finally, the relationship you have with your client can influence your level of exposure. If a client perceives there is a design defect, manufacturing defect or that your product packaging failed to warn them of potential danger in using the product or the packaging that contains the product, she can file a legal claim to recover financial compensation.

The California Safe Cosmetics Act is legislation recently passed that will impose additional obligations for safety,” says Blinkoff. “California also has Proposition 65, which requires products that contain listed chemicals to bear a warning regarding the product being a possible carcinogen or reproductive toxicant. Failure to include the required warning can impose liability on all parties in the supply chain. The fines can be significant—in excess of $2,500 per day.

Unlike a typical negligence product liability case that requires proof of the elements, a Proposition 65 violation creates absolute liability. Product liability cases generally require proof of the following to establish liability—that you: one, had a duty to warn the client; two, you breached that duty; three, there was a resulting injury; and four, that the breach caused the injury.

And California isn’t the only state moving in this direction. “Illinois, Oregon and Washington have introduced bills somewhat mirroring what California has passed into legislation, and I understand other states are considering similar action,” reports Geffken.

Be prepared