Eleventh Circuit Confirms Businesses Protected From Tort Liability in Some Product Liability Cases
Eleventh Circuit Confirms Businesses Protected From Tort Liability in Some Product Liability Cases Apr 11, 2017 The Eleventh Circuit (which includes Florida) recently confirmed a rule early codified into contracts law known as the Economic Loss Rule, which prohibits a plaintiff from recovering under a torts-based claim (such as a claim for negligence) when a product defect fails to cause personal injury or property damage. Although the Florida Supreme Court had previously strengthened the scope of the Economics Loss Rule, this recent case brought before the Eleventh Circuit demonstrates that parties still attempt to hold manufacturers and other businesses responsible for negligence when it is clear that contract law bars such a claim. Because of this risk, it is wise for businesses to build specific safeguards into legal contracts in order to avoid certain disputes. The Economic Loss Rule The Economic Loss Rule has long-prevented parties from bringing a tort claim when a product defect or failure only causes damage itself (i.e. results in economic loss) but does not cause harm or injury to an individual or their property. When this happens, any party who wishes to sue a manufacturer or business must sue under breach of contract, but not under product liability claims. Florida Supreme Court’s Expansion Not only has the rule historically barred these types of tort claims without exception but, in fact, over the past four years, the Florida Supreme Court has expanded the scope of the rule in response to questions posed by the Eleventh Circuit. Specifically, the court reaffirmed that the economic loss rule precludes recovery of economic damages in torts where there is no property damage or personal injury, and also limited the application of the rule to those situations where the parties were not in privity to each other. In other words, the Court deemed that where parties had an existing contractual relationship, the Economic Loss Rule completely barred a product liability claim. Eleventh Circuit Reaffirms The Economic Loss Rule was recently reaffirmed by the Eleventh Circuit in a decision which ruled in favor of the manufacturer’s motion to dismiss. Specifically, the case involved a radiologist who filed a negligence claim against the manufacturer of his MRI scanner (which no longer worked). While the radiologist claimed that the machine no longer worked due to negligent servicing, in fact, the servicing contract with the manufacturer had long expired before the claim was even filed. As a result, the Court correctly dismissed the claim, reaffirming that plaintiffs cannot recast contract claims as negligence claims. Protect Your Business Regardless of how consistently the Economic Loss Rule has been strengthened by the courts, parties will still sometimes seek to hold manufacturers and businesses liable under tort law instead of appropriately bringing a breach of contract claim. In an effort to avoid expending litigation funds to dismiss such claims, working with an experienced business attorney can help ensure that any contracts you enter into as a business prevent you from being frivolously dragged into court. At HD Law Partners, our Orlando, Sarasota, and Tampa, Florida business & corporate law attorneys possess the legal knowledge and skills necessary to help prevent potential problems before they occur, while also addressing any present difficulties you may be facing. We can ensure that your company’s assets and best interests are protected. Contact us today to set up a free consultation. Resource: casetext.com/case/tiara-condo-assn-inc-v-marsh-united-states Tags: Florida Corporate Defense, Tampa Business Lawyer, Tampa Business Lawyers Posted in Business Corporate | No Comments » Connect with us Archives May 2026 April 2026 March 2026 February 2026 January 2026 December 2025 November 2025 October 2025 September 2025 July 2025 June 2025 January 2025 January 2024 December 2023 November 2023 October 2023 September 2023 August 2023 July 2023 June 2023 May 2023 April 2023 March 2023 February 2023 January 2023 December 2022 November 2022 October 2022 September 2022 August 2022 July 2022 May 2022 April 2022 March 2022 November 2021 October 2021 September 2021 August 2021 July 2021 May 2021 April 2021 March 2021 February 2021 January 2021 December 2020 November 2020 October 2020 August 2020 July 2020 June 2020 May 2020 April 2020 March 2020 February 2020 January 2020 December 2019 November 2019 October 2019 September 2019 August 2019 July 2019 June 2019 May 2019 April 2019 March 2019 February 2019 January 2019 December 2018 November 2018 October 2018 September 2018 August 2018 July 2018 June 2018 May 2018 April 2018 March 2018 February 2018 January 2018 December 2017 November 2017 October 2017 September 2017 August 2017 July 2017 June 2017 May 2017 April 2017 March 2017 February 2017 January 2017 December 2016 November 2016 October 2016 November 13 Categories Alimony Appellate Arbitration Auto Accidents Auto Insurance Business Corporate Business Insurance Law Child Custody Child Support Criminal Law Divorce Family Law FEMA Insurance Payments Florida’s Mandatory 2‑Hour Legal Professionalism CLE: Foreclosure Defense Fort Myers Hurricane Insurance Attorney General Guardianship HD Law Partners Service HOA/Property Management Homeowners Association Homeowners Insurance Hurricane Claims Hurricane Insurance Insurance Bad Faith Insurance Claims Insurance Defense Insurance Litigation Landlord Tenant Law Enforcement Liability Loan Modifications Mold Water Damage Parental Rights Paternity Personal Injury Premises Liability Law Prenuptial Agreements Private Security Property Distribution Property Owner Law Sarasota Insurance Litigation Attorney Slip Fall Tampa Business and Corporate Attorneys tampa family attorney Tampa Insurance Attorneys Timeshare Timesharing Uncategorized HD Law Partners is proud to be your trusted full-service law firm Quick Links Property & Casualty Business & Corporate Litigation Family Law Contact Us Careers Get In Touch 2002 North Lois Avenue Suite 510 Tampa, FL 33607 813-253-5333 Contact Us