Chamber Blasts Senate Commerce Bill Criminalizing Product Liability Laws

WASHINGTON, D.C. – The United States Chamber of Commerce strongly opposed legislation that would add criminal penalties to product liability laws covering auto equipment and cars, in a letter sent to Senators.

"Adding criminal penalties to product liability laws will not create safer products," said Bruce Josten, Chamber executive vice president. "There already are numerous ways that consumers can punish companies for defective products, both through punitive damage awards in civil cases or through criminal penalties for fraud."

A new layer of criminal prosecution – which would supercede all civil tort claims – will create huge delays for victims seeking timely recovery of damages, according to the Chamber. Further, fear of criminal sanctions – including the possibility of imprisonment – could have a chilling effect on cooperative efforts between manufacturers and the government. Solutions to questions around product safety often rely on cooperative, and swift, action among federal agencies and businesses.

The Senate is currently considering legislation (S.3059) that would strengthen the National Highway Safety Transportation Administration's (NHTSA) authority to regulate carmakers through more stringent product safety standards. The legislation also includes criminal penalties on manufacturers of faulty products. While the Chamber supports updating federal oversight through NHTSA, adding criminal penalties to product liability laws could be counterproductive.

"This type of legislation could push companies into a hear-no-evil, see-no-evil situation," said Josten. "Criminally penalizing 'knowing and willful' violations creates a strong incentive for companies – under due process and the advice of legal counsel – to practice willful ignorance by omitting tests and studies."

The regulation of product manufacturing should promote safety, protect the public and penalize misconduct without damaging development and innovation, the Chamber noted. The proposed legislation runs counter to all these goals.

The U.S. Chamber of Commerce is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region.

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