INDEPENDENT EQUIPMENT DEALERS ASSOCIATION

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INDEPENDENT EQUIPMENT DEALERS ASSOCIATION Mitchell S. Milby, Esq. Phillip A. Tumbarello, Esq. Sean McDonough, Esq. INDEPENDENT EQUIPMENT DEALERS ASSOCIATION February 15, 2016 © 2016 Wilson Elser. All rights reserved.

Know Thy Seller/Buyer AS A YOUNG CHILD MY MOTHER TOLD ME I CAN BE ANYONE I WANT TO BE TURNS OUT THIS IS CALLED IDENTITY THEFT © 2016 Wilson Elser. All rights reserved.

Know Thy Seller/Buyer Legal name Contact information Tax ID References © 2016 Wilson Elser. All rights reserved.

Know Thy Equipment © 2016 Wilson Elser. All rights reserved.

Know Thy Equipment Inspections, aka, you do inspect the equipment, right? Benefit of you vs. third-party inspection Buyer inspections & limitations/disclaimers © 2016 Wilson Elser. All rights reserved.

Know Thy Equipment Seller Warranty Possession Right to sell Lien searches and limits © 2016 Wilson Elser. All rights reserved.

Product Liability Is there a defect? Did the defect cause an injury? Design Manufacture Warnings Did the defect cause an injury? Damages? © 2016 Wilson Elser. All rights reserved.

Product Liability A lawsuit filed by an injured party against a manufacturer, distributor or seller of a product Product liability claims are governed by state law – state statutes or case law Question of product defect is a fact question decided by the jury trials © 2016 Wilson Elser. All rights reserved.

Product Liability Liability without regard to negligence Liability without regard to privity All parties in the chain of distribution © 2016 Wilson Elser. All rights reserved.

How Do You Determine Product Defect? Definitions of defect vary from state to state Most common definitions include: Do the risks posed by the product outweigh the utility? Is the product more dangerous than a reasonable consumer would expect? Are there reasonable alternative designs that would have prevented the accident? © 2016 Wilson Elser. All rights reserved.

Restatement (Second) of Torts What is a defect? Risk/benefit test Consumer expectation test © 2016 Wilson Elser. All rights reserved.

Restatement (Third) of Torts What is a defect? Reasonable alternative design © 2016 Wilson Elser. All rights reserved.

Product Liability: Practical Aspects Codefendants and settlements by codefendants Apportionments of liability Pre-judgment interest Standards for punitive damages Awarded in 10 to 12% of cases © 2016 Wilson Elser. All rights reserved.

American Tort Form Association Publishes annual lists on line – CA, NYC, FL, MO, IL (Madison County), LA, Texas (Hidalgo County & U.S. Eastern District), Virginia (Newport News) The same venues are on the lists year after year, usually only the order of the ten worst venue changes (the ten are usually the same) © 2016 Wilson Elser. All rights reserved.

The Least You Need to Know Product liability issues: Defect? Causation? Compensation? Jury decides Three types of defects: Design, Manufacture, Warnings Trials are a battle of experts Compliance with standards is only evidence, not a defense © 2016 Wilson Elser. All rights reserved.

Gray Market © 2016 Wilson Elser. All rights reserved.

Can You Limit Your Liability? © 2016 Wilson Elser. All rights reserved.

State-by-State, i.e., uneven © 2016 Wilson Elser. All rights reserved.

You Can Trust Me, Do We Really Need a Contract? Master agreement Warranty v. AS-IS Defense & indemnity – getting and giving Consequential damages © 2016 Wilson Elser. All rights reserved.

Warnings © 2016 Wilson Elser. All rights reserved.

Conclusion “Everything will be okay in the end. If it’s not okay, it’s not the end.” (unknown) © 2016 Wilson Elser. All rights reserved.

Contact Mitchell S. Milby Partner Dallas, TX 214.698.8071 mitchell.milby@wilsonelser.com Phillip A. Tumbarello Partner White Plains, NY 914.872.7343 phillip.tumbarello@wilsonelser.com Sean M. McDonough Partner Orlando, FL 407.203.7558 sean.mcdonough@wilsonelser.com © 2016 Wilson Elser. All rights reserved.