The Product Liability and Mass Torts Group at McCarthy Tétrault LLP is pleased to bring you our analysis of recent decisions for businesses manufacturing or selling products in Canada:
- The Ontario Superior Court of Justice clarifies the test for design negligence in cases of inherently dangerous products: Price v. Smith & Wesson Corp., 2024 ONSC 1368
- The Ontario Divisional Court upholds redactions justified by European Union law: Harris v. Bayerische Motoren Werke Aktiengesellschaft et al., 2024 ONSC 2341
- The Supreme Court of British Columbia provides a useful review of British Columbia's law of negligent design in I.F. v. Gilead Sciences, Inc., 2024 BCSC 480
- The Superior Court of Quebec skirts a contractual governing law provision in a product liability dispute: Entreprises Lefebvre Industri-Al inc. c. Shred-Tech Corporation, 2024 QCCS 1320
- The Superior Court of Quebec applies the learned intermediary doctrine to prescription medicines: Jaafar c. Janssen inc., 2024 QCCS 200
The Ontario Superior Court of Justice clarifies the test for design negligence in cases of inherently dangerous products: Price v. Smith & Wesson Corp., 2024 ONSC 13681
The Ontario Superior Court of Justice has addressed the test for design negligence in cases involving "inherently dangerous" products like firearms, in the context of a certification motion. The Court confirmed that manufacturers are entitled to make reasonable trade-offs between risk and utility in designing products, including inherently dangerous products.
Background
In July 2018, an individual used a stolen M&P®40 handgun manufactured by the defendant Smith & Wesson to kill two people and injure several others. One of the injured individuals and her family members sought certification of a class action against Smith & Wesson. The plaintiffs alleged that Smith & Wesson had negligently designed the M&P®40 by failing to install it with "authorized user technology" that would have allowed the weapon to fire only when activated by an authorized user. The plaintiffs alleged that the assailant could not have caused the plaintiffs' injuries had the stolen M&P®40 properly been installed with authorized user technology.
The Court previously dismissed an application to strike the plaintiffs' claims.2 In this 2024 decision, the Court considered, as part of the certification application, whether the plaintiffs had provided some basis in fact to show that Smith & Wesson was negligent in designing the M&P®40 by failing to install it with authorized user technology.
Outcome
The Court dismissed the plaintiffs' motion for certification.
A product is negligently designed only if it contains a design "defect" that creates a substantial risk of harm. A defect results from a manufacturer's "careless decision[] about the composition" of its product.3 Therefore, to find a defect, the Court must apply a holistic risk-utility analysis, considering not only whether the manufacturer could have designed a safer product, but also whether safer alternative designs would have unduly impaired the utility of the product for its intended users, or greatly increased the product's cost.4
Given that framework, the plaintiffs had to show that authorized user technology could have been installed on the M&P®40 at a reasonable cost, without impairing the M&P®40's utility for its intended users – police officers and the military. The plaintiffs did not lead evidence showing some basis in fact for those requirements.5
Instead, the plaintiffs led evidence that Smith & Wesson failed to install authorized user technology on the M&P®40 even though Smith & Wesson knew stolen or lost weapons could be used by unauthorized users, and even though authorized user technology had been developed to address that risk.6
But an inherently dangerous product is not necessarily defective only because it could have been manufactured to be safer. There must be a holistic analysis of risk and utility. Without evidence relevant to that analysis, the Court could not certify the proposed common issue in respect of Smith & Wesson's alleged design negligence.
The plaintiffs argued that requiring more detailed risk and utility evidence at the certification stage was unfair because of the "inherent informational imbalance" that favours manufacturers in a product liability case before discovery and disclosure.7 The Court acknowledged that the plaintiffs might have an information deficit about the defendant's design choices, but held that that deficit did not relieve them from their burden of identifying a design defect or establishing a methodology for conducting a risk-benefit analysis.8
The Court also considered causation and other issues, and ultimately declined to certify the class action.
Key Takeaway
- An inherently dangerous product is not necessarily negligently designed just because it could have been made to be safer. The Court will consider a holistic risk-utility analysis to determine whether the manufacturer made "careless decisions about the composition" of its product, in light of the cost and utility of alternate, safer designs.
The Ontario Divisional Court upholds redactions justified by European Union law: Harris v. Bayerische Motoren Werke Aktiengesellschaft et al., 2024 ONSC 2341
Should an Ontario court consider whether an order it makes could cause a litigant to breach an applicable foreign law? In Harris v. Bayerische Motoren Werke Aktiengesellschaft et al., 9 the Ontario Divisional Court answered "yes."
Background
In Harris, the Ontario Divisional Court largely dismissed an appeal of an interlocutory decision that allowed BMW to redact an affidavit of documents due to concerns regarding European Union and German privacy law. The decision relates to an ongoing class action concerning allegedly defective power steering units in Mini Cooper cars.
Outcome
The Divisional Court dismissed the appeal on grounds that: 1) the motion judge did not exceed his jurisdiction or deny the appellant procedural fairness; 2) the motion judge did not err in ordering that BMW could redact customers' data; and 3) the motion judge was not incorrect in finding that redactions should have been allowed if they were required by foreign law.
Key Takeaway
- The Divisional Court was clear that a domestic court should take foreign laws into account where compliance with those laws would not interfere with the fact-finding responsibilities of the court. Redaction in this case appropriately balanced the fact-finding and disclosure responsibilities of the court and the privacy issues protected by foreign law.10
Footnotes
1 Price v. Smith & Wesson Corp., 2024 ONSC 1368.
2 Price v. Smith & Wesson Corp., 2021 ONSC 1114.
3 Price v. Smith & Wesson Corp., 2024 ONSC 1368, at para. 8.
4 Price v. Smith & Wesson Corp., 2024 ONSC 1368, at paras. 51-56.
5 Price v. Smith & Wesson Corp., 2024 ONSC 1368, at para. 158.
6 Price v. Smith & Wesson Corp., 2024 ONSC 1368, at para. 157.
7 Price v. Smith & Wesson Corp., 2024 ONSC 1368, at para. 156.
8 Price v. Smith & Wesson Corp., 2024 ONSC 1368, at para. 161.
9 Harris v. Bayerische Motoren Werke Aktiengesellschaft et al., 2024 ONSC 2341.
10 Harris v. Bayerische Motoren Werke Aktiengesellschaft et al., 2024 ONSC 2341, para. 49.
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