Insurers Welcome Rhode Island Supreme Court Lead Paint Decision

July 2, 2008

The property/casualty insurance industry is applauding a recent Rhode Island court ruling on lead paint for confirming that a state’s product liability, not public nuisance, law should govern in such cases.

In its landmark ruling, the Rhode Island Supreme Court unanimously overturned a lower court decision against several former lead paint manufacturers and their trade association, rejecting an expansion of public nuisance law into environmental pollution and product liability.

According to the Property Casualty Insurers Association of America (PCI), the Rhode Island court joins the Ohio, Missouri, New Jersey and Wisconsin high courts in thwarting expansion of these types of cases.

“This ruling is significant in that it deliberately respects the boundaries between the judiciary and legislative branches,” said David Golden, director of commercial lines for PCI. “By sticking to the facts of the case and law as it is written, the court rejected the notion of unwarranted judicial intervention. The court recognized that it is bound by the law and reinforced the concept that product liability cases should continue to be tried under negligence law, rather than using the lower standards of proof found in public nuisance law.”

Golden said the Rhode Island Legislature has already addressed the issue of abatement and “found that the responsibility lies with the landlord and property owners, not the paint manufacturers whose products could not be tied directly to specific injuries.”

In reaching its conclusion, the Ocean State’s high court stated, “We do not mean to minimize the severity of the harm that thousands of children in Rhode Island have suffered as a result of lead poisoning. Our hearts go out to those children whose lives forever have been changed by the poisonous presence of lead. But, however grave the problem of lead poisoning is in Rhode Island, public nuisance law simply does not provide a remedy for this harm. The state has not and cannot allege facts that would fall within the parameters of what would constitute public nuisance under Rhode Island law.”

The National Association of Mutual Insurance Companies (NAMIC) had filed an amicus brief in the case along with other organizations opposing expansion of the law.

“Under the trial court’s application of public nuisance law in this case, the government would have near limitless ability to impose liability on an industry if its products could at some point contribute to an inherent risk to enough people,” the organizations argued in their brief. “Any business that ever lawfully made or sold a product could be held liable in Rhode Island at the whim of the attorney general if the product category as a whole were misused or not properly maintained by certain members of the public and, as a result, became associated with a potential hazard.”

According to Paul Tetrault, NAMIC’s Northeast state affairs manager, the Rhode Island decision reflects the arguments made in these amicus briefs.

“The Rhode Island Supreme Court’s decision tracks with the amicus brief in significant respects regarding what has to be proven in order to bring a public nuisance claim; and it expresses appreciation to the groups that filed it for helping to address novel arguments,” Tetrault said. “The decision is consistent with rulings by supreme courts in Missouri, New Jersey, and Illinois rejecting product-based public nuisance claims.”

Tetrault said the decision reestablishes that product liability laws – not public nuisance laws – are the proper means for claims against product manufacturers. “The court has rejected another attempt by a state attorney general to improperly use public nuisance laws to circumvent the well-defined structure of product liability laws,” he said.

Sources:
PCI
www.pciaa.net

NAMIC
www.namic.org

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