Compliance Vs Common Law

Compliance vs. Common Law: When Meeting Standards Isn't Enough

Automotive manufacturers often invest millions in regulatory compliance, meticulously checking boxes on Federal Motor Vehicle Safety Standards (FMVSS), emissions requirements, and certification protocols. Yet history is littered with cases where fully compliant products still triggered massive liability under common law theories. This disconnect—between satisfying regulatory minimums and fulfilling common-law duties—represents one of the most challenging aspects of product safety management. This post examines the complex relationship between regulatory compliance and tort liability, exploring when and why courts look beyond the regulatory shield and how expert witnesses help juries understand the gap between minimum standards and reasonable care.

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  1. The Regulatory Compliance Defense: Origins and Limitations

Historical Evolution

  • 1916: MacPherson v. Buick Motor Co. establishes that manufacturers owe a duty of care directly to consumers, regardless of privity
  • 1960s: Expansion of federal safety regulations creates standardized minimums
  • 1980s–1990s: Rise of regulatory compliance as an affirmative defense
  • 2000s–Present: Courts increasingly recognize compliance as necessary but not sufficient for tort immunity

The Theoretical Foundations The regulatory compliance defense rests on several principles:

  • Legislative preemption of common law (express or implied)
  • Agency expertise and comprehensive risk assessment
  • Regulatory processes that incorporate stakeholder input
  • Uniform standards that create predictable obligations

Yet courts consistently recognize its limitations:

  • Regulations establish minimum, not optimal, safety requirements
  • Standards often lag behind technological capabilities
  • Regulatory capture may influence standard-setting
  • Regulations cannot anticipate all foreseeable misuse scenarios

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  1. Federal Preemption: The Limited Shield Against State Tort Claims

The Preemption Doctrine Federal preemption can potentially shield manufacturers from state tort claims when:

  • Congress explicitly preempts state law (express preemption)
  • Federal regulation so thoroughly occupies the field that state law is precluded (field preemption)
  • Compliance with both federal and state requirements is impossible (conflict preemption)

The Motor Vehicle Safety Act Paradox The National Traffic and Motor Vehicle Safety Act contains a savings clause (49 U.S.C. § 30103(e)) stating: "Compliance with a motor vehicle safety standard prescribed under this chapter does not exempt a person from liability at common law."

This creates a complex landscape where:

  • Express preemption rarely applies to automotive cases
  • Conflict preemption applies only in narrow circumstances
  • Compliance remains relevant evidence but not dispositive

Key Preemption Cases in Automotive Litigation

  • Geier v. American Honda Motor Co. (2000): Supreme Court found conflict preemption where FMVSS 208 specifically provided manufacturers flexibility in airbag implementation, preempting a state tort claim alleging negligence for not installing airbags
  • Williamson v. Mazda Motor of America (2011): Supreme Court distinguished Geier, finding no preemption where FMVSS 208 gave manufacturers choice between lap belts and lap/shoulder belts for rear inner seats
  • Sprietsma v. Mercury Marine (2002): Supreme Court rejected preemption defense where Coast Guard had considered and declined to adopt propeller guard requirement

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  1. Real-World Case Studies: Compliant Products, Substantial Liability

FMVSS-Compliant Products That Still Lost in Court

  1. The GM Side-Saddle Fuel Tank Litigation In Moseley v. General Motors Corp. (1993), GM's pickup trucks met all applicable FMVSS 301 fuel system integrity standards. Nevertheless, a Georgia jury awarded $101 million in punitive damages after concluding that:
    • GM's own internal test data showed vulnerability to side-impact collisions
    • Alternative designs with inside-the-frame tanks were technically and economically feasible
    • The company knew of the risk but determined it was cheaper to pay crash settlements than redesign

Expert testimony focused on:

  • Tests exceeding the minimum regulatory standards but representing foreseeable accident scenarios
  • Internal corporate memos discussing the risk-benefit analysis in financial terms
  • Comparison of GM's design to industry alternatives that exceeded regulatory minimums
  1. The Ford Explorer Rollover Litigation Despite complying with FMVSS 216 (roof crush) and FMVSS 126 (electronic stability control) standards, Ford faced substantial liability in Buell-Wilson v. Ford Motor Company (2006), where a jury awarded $369 million (later reduced). Key factors included:
    • Evidence that Ford engineers had recommended stability improvements beyond regulatory requirements
    • Documentation showing knowledge of higher rollover risk compared to passenger cars
    • Testimony that Ford's own internal guidelines called for safety margins exceeding federal minimums

These cases illustrate a consistent principle: compliance provides a floor, not a ceiling, for safety obligations.

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  1. The "Reasonably Prudent Manufacturer" Standard: Beyond Regulatory Minimums

Common Law Expectations Courts typically judge manufacturers against what a "reasonably prudent manufacturer" would do—not merely what regulations require. This standard encompasses:

  • State-of-the-art knowledge available at the time of manufacture
  • Industry practices that exceed regulatory minimums
  • Internal corporate safety standards and test protocols
  • Foreseeable use and misuse scenarios

In Grimshaw v. Ford Motor Co. (1981), the infamous Pinto case, the court observed that "regulatory standards are not maximum standards of care but minimum standards which do not provide a shield against common law liability."

How Courts Evaluate "Reasonable Care" Factors courts consider in determining whether compliance constitutes reasonable care include:

  • The vintage and adequacy of the regulation at issue
  • Whether the standard addresses the specific risk that materialized
  • The degree to which technology has advanced since the standard was promulgated
  • Whether competitors exceeded the minimum standard
  • Evidence of internal recognition that the standard was inadequate

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  1. Expert Witness Strategies: Navigating the Compliance/Common Law Divide

Plaintiff Expert Approaches Plaintiff experts typically employ several strategies to overcome compliance defenses:

  • Identifying foreseeable risks not addressed by applicable regulations
  • Demonstrating that the particular standard is outdated or minimal
  • Showing industry practices that routinely exceed regulatory requirements
  • Presenting internal company documents revealing knowledge of inadequacy
  • Offering reasonable alternative designs that would have prevented harm while still meeting regulations

For example, in a 2019 seatback failure case, plaintiff experts successfully argued that FMVSS 207 (established in 1968) represented an outdated minimum standard that did not address foreseeable rear-impact scenarios in modern traffic conditions.

Defense Expert Approaches Defense experts generally focus on:

  • The comprehensive nature of the regulatory scheme
  • The expertise and risk assessment incorporated into standards development
  • Testing showing performance well above minimum requirements
  • Uniform industry adherence to the standard at issue
  • The public policy benefits of regulatory standardization

Building a Dual-Track Expert Report Sophisticated experts prepare reports addressing both regulatory compliance and common law standards:

  • Documenting full compliance with all applicable regulations
  • Demonstrating how the design incorporates safety margins beyond minimums
  • Explaining how the manufacturer evaluated and addressed foreseeable risks
  • Contextualizing the development process within industry norms
  • Analyzing the risk-utility balance of the chosen design against alternatives

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  1. Best Practices: Beyond Compliance to Defensibility

Manufacturers can reduce liability exposure while maintaining compliance through several approaches:

Regulatory Plus Framework

  • Identify regulatory requirements as baseline minimums
  • Implement corporate standards exceeding regulations in critical safety areas
  • Document decision-making processes for safety-critical features
  • Benchmark against industry leaders rather than regulatory floors

Risk Management Documentation

  • Create "beyond compliance" white papers for C-suite sign-off
  • Develop formal assessment protocols for foreseeable misuse scenarios
  • Implement systematic reviews when new technologies or use patterns emerge
  • Maintain clear records of alternative designs considered and rejection rationales

Active Safety Monitoring

  • Establish early warning systems for field incidents
  • Analyze warranty data for potential safety trends
  • Monitor competitor recalls and incidents for industry learning
  • Document responsive design changes even when not required by regulation

Example: Toyota's Unintended Acceleration Response Following intense litigation over alleged unintended acceleration, Toyota implemented a "defensive compliance" approach that included:

  • Safety standards exceeding NHTSA requirements
  • Brake override systems not mandated by FMVSS
  • Enhanced design validation for electronic throttle controls
  • Comprehensive event data recorders exceeding regulatory minimums

These measures helped restore consumer confidence and strengthen Toyota's litigation posture in subsequent cases.

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  1. The Role of Internal Testing in Establishing the Standard of Care

Internal test data often becomes the focal point in compliance vs. common law disputes:

How Internal Tests Can Undermine Compliance Defenses

  • Tests showing failures in scenarios beyond regulatory requirements
  • Documentation of known limitations in regulated test procedures
  • Analysis identifying higher safety margins in competitor products
  • Engineering recommendations for improvements not implemented

In Hutchinson v. Automotive Corp. (2017), the manufacturer's compliance defense collapsed when discovery revealed internal testing showing its compliant restraint system performed significantly worse than competitors in oblique-impact scenarios not directly addressed by FMVSS 208.

Strategic Approaches to Internal Testing To balance innovation with legal protection, manufacturers should:

  • Clearly delineate regulatory compliance tests from exploratory research
  • Establish formal processes for addressing non-compliance findings
  • Document engineering responses to identified risks, even if no design change results
  • Involve legal counsel in developing testing protocols with litigation implications

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Conclusion

The tension between regulatory compliance and common law liability remains a central challenge in automotive product safety. While compliance provides an essential foundation, courts consistently look beyond the regulatory floor to evaluate whether manufacturers exercised reasonable care under the circumstances. By implementing "compliance plus" approaches—systematically exceeding regulatory minimums, documenting safety decisions, and preparing comprehensive expert analyses—manufacturers can navigate this complex landscape more effectively.

Ultimately, the most defensible position combines rigorous regulatory compliance with robust engineering judgment that anticipates and addresses foreseeable risks beyond the minimum standards. As automotive technologies continue to outpace regulatory frameworks, this integrated approach becomes increasingly important in managing both safety and liability concerns.

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