The presumption of nonliability for products manufactured to meet or exceed mandatory federal safety standards, § 82.008, CPRC, is one of the cornerstones of the 2003 tort reform effort. This provision has come under repeated attack in product liability litigation around the state, especially in the context of motor vehicle accidents. In order to over to overcome the presumption, the plaintiff must show that the specific standard governing the product at issue is inadequate and exposes the public to an unreasonable risk of harm. In general, plaintiffs have to produce an expert qualified under Rule of Evidence 702 to give an opinion detailing the inadequacy of the federal standards. Some trial courts are better than others at enforcing Rule 702 and properly applying the Robinson standards. Others have allowed evidence of corporate lobbying of Congress and federal agencies to argue that the defendant made material misrepresentations about their products to water down the pertinent regulations. Still others have let the jury hear evidence relating to dissimilar products or other safety issues to show inadequacy. Some of these cases have produced megaverdicts on highly questionable evidentiary grounds.
In late June the Texas Supreme Court decided American Honda Motor Co., Inc. v. Milburn (No. 21-1097; June 28, 2024)), on petition for review from the Dallas Court of Appeals. As we reported last year, this case arose from a collision between a Honda Odyssey, driven by an rideshare driver, and a pick-up truck. One of the passengers in the Uber was sitting in the middle seat of a fold-down third row. This particular seat design, which is common in a variety of SUVs, has a federally approved safety design which requires the lap belt to be anchored to the seat (otherwise the seat does not fold flat). The manufacturer specifically instructs and warns owners to make sure the belt is anchored before passengers sit there. Neither the driver nor the passenger did this, and the plaintiff was injured when the driver ran a red light and hit the truck. At trial, the plaintiff’s seatbelt expert admitted that the seatbelt in question met the standard. There was also no evidence that any other injuries involving the seatbelt had been reported and no recalls have ever been made.
The plaintiff, however, offered a second expert who opined that the federal standard was inadequate because Honda could foresee that a passenger in that seat would not know about the seatbelt design or whether it was properly anchored. She made this conclusion based on a test designed and performed by plaintiff’s counsel (with no representative of the defendant present), in which several dozen people were asked to sit in that seat and fasten the seatbelt, which was unanchored. Predictably, no one knew or asked about it, but simply assumed the belt was operating properly. This is called “human factors” testing, and the “expert” admitted that it was both contrived and unscientific. Incredibly, the trial judge let the testimony in over Honda’s objection. The trial judge also excluded evidence that the driver had a criminal record, assaulted a passenger, and been involved in another accident while speeding. Even more incredibly, the trial court refused to allow Honda to submit the fault of a settling party—the driver—to the jury on the basis that he was an “employee” of the rideshare company. The jury awarded the plaintiff more than $30 million.
The court of appeals affirmed. In an opinion notably bereft of legal analysis, the court found that the trial court did not abuse its discretion in admitting the plaintiff’s bogus study or excluding evidence of the driver’s fault. It likewise let stand the trial court’s decision to keep the jury from assigning fault to the driver. We wish we could offer a reasoned justification for this holding, but one does not exist. Honda sought review, challenging both the validity of the “human factors” test and the exclusion of the driver’s fault. TCJL filed an amicus curiae brief in support.
Our brief argued that both the trial and appellate courts failed in their duty as gatekeepers to throw out “junk science” expert testimony. By not applying Rule 702 to the plaintiff’s “human factors” expert, these courts opened the door to whatever “study” a plaintiff’s counsel can cook up in order to rebut the presumption of nonliability, so much so that the presumption will become a dead letter. We also took the courts below to task for flat out violating Chapter 33, CPRC, by blocking submission of the negligent driver’s fault. In our view, this case demonstrated how a result-oriented court can use evidentiary rulings to subvert legislative policy decisions about tort law.
In an opinion by Justice Lehrmann, SCOTX reversed and rendered judgment in favor of Honda. The Court resolved the case entirely on statutory construction grounds. First, the majority opined that in most cases “the presumption’s applicability is a question of law for the court” (citing Kim v. Am. Honda Motor Co., 86 F.4th 150, 169-70 (5th Circ. 2023)). Here the parties did not dispute that Honda complied with the mandatory standards governing the seat belt that were applicable to the vehicle at the time of its manufacture. Nevertheless, the majority acknowledged, an contested issue might arise as to whether the standards “governed the product risk that allegedly caused the harm,” but even in that case the court should make the determination as a matter of law since a question involves the “interpretation of a government agency’s regulation” (though the majority held out the possibility that a disputed fact issue could also arise). Plaintiff argued that Honda’s compliance with the standard was “irrelevant because it does not govern the product risk at issue—specfically, ‘the risk that owners, drivers, and passengers will fail to reliably use the detachable seat belt system in a correct manner.’” Distinguishing its prior decision in Kia Motors, which held that § 82.008’s presumption did not apply to an airbag that failed to deploy in an accident, the Court observed that here the NHTSA “deliberately chose to allow the dual-detachable system” for the third-row seatbelt and that the agency “contemplated [the risk of misuse] when [it] assessed whether to allow this type of system at all: that is, the risk of misuse was part of the cost-benefit analysis.”
Having determined that the presumption applied, the Court moved on to whether Plaintiff rebutted it. Prior to this case, Justice Lehrmann noted, the Court had “not had the occasion to address what is necessary to establish that ‘the mandatory federal safety standards or regulations applicable to the product were inadequate to protect the public from unreasonable risks of injury or damage’” under § 82.008(b)(1). First, the majority observed that rebuttal evidence showing that an applicable safety standard is inadequate “requires something other than proof of a product’s defective design—that is, something more than a conclusion that the risks outweighed the benefits with respect to the particular product design at issue” (otherwise, § 82.008’s presumption would be meaningless). Here the Court admonished the court of appeals for simply ignoring the distinction and conflating the “necessarily independent inquiries” of “defective design” and “regulatory inadequacy.” In this regard, the majority seconded the argument we made in our amicus brief to the effect that the court of appeals’ opinion essentially read the statute out of existence. As Justice Lehrmann pithily stated, “[A]t bottom, if Milburn’s interpretation of the statute is correct, then the analysis is as follows: a defendant is liable for a defective design if the plaintiff proves X, unless the product complies with an applicable federal safety standard, in which case the defendant is not liable unless the plaintiff proves X (which has already been proven). Such a reading would effectively delete the presumption of nonliability.”
The majority acknowledged that a future case might come out differently if “subsequent developments could demonstrate that the standard was no longer adequaate to protect the public from unreasonable risks of injury at the time of the compliant product’s manufacture,” for example “a material change in technology or a proliferation of new studies or data about risks and injuries associated with a compliant product.” It thus gave future claimants something of a roadmap to navigate the § 82.008 presumption, as well as cautioned manufacturers not to get too comfortable with mandatory standards that may not be keeping up with the times. And although the Court did not need to reach Honda’s federal pre-emption argument, we think it highly unlikely that such an argument will succeed absent a change in federal law itself.
Justice Blacklock, joined by Justice Busby, concurred, agreeing with the majority that the issue of regulatory inadequacy could be attacked in future cases on a number of fronts” and that “[a] fact finder cannot validly judge a federal agency’s balancing of [safety, cost, feasibility, etc.] unless he knows something about how the regulatory process works and has a sense of the many conflicting considerations and competing values—safety just one among them—that contributed to the promulgated regulation.” Juries can make a determination of inadequacy, but to do so, as Honda argued, “a qualified regulatory expert would need to explain why, in the context of the entire regulatory history and the delicate balance between absolutely safety and commercial feasibility, the agency’s determination was . . . ‘inadequate.’” Here Plaintiff offered no such expert but rather asked the jury “to condemn the regulation based on the singular consideration of patient safety.”
Justice Devine, joined by Justice Boyd, dissented. The dissent, as we understand it, argues that the majority deviated from the plain text of the statute by limiting a plaintiff’s ability to rebut the presumption to situations in which an agency acted arbitrarily or capriciously or when “post-approval” developments rendered the safety standard no longer adequate to protect the public.” Justice Devine goes on to say that “the Legislature entrusted the final factual determination of that standard’s adequacy to our juries alone, not federal agencies.”
Needless to say, in our opinion the majority read the statute exactly the way the Legisalture wrote it and meant to write it. There is no question, as the dissent emphasizes, that the accident at the root of this case had terrible consequences for its victim. In enacting § 82.008, however, the Legislature made a policy decision to balance the social and economic costs of ever higher levels of product safety regulation against the vagaries and unpredictability of the tort system. Justice Blacklock’s concurring opinion explicitly makes this point. In any event, we once again see how difficult a task our judges and justices face in getting the law right in the face of tragic individual circumstances.
