Colorado’s reasonable approach to distributor liability

One of the more interesting problems in products law is how to handle the middle man. If the retailer does not design or manufacture a product, but merely stocks its shelves, can he be liable to a plaintiff who is injured by the product? Different states handle the question differently.

In Colorado, unless the retailer is also the manufacturer of the allegedly defective product or a component of the product, it can’t be sued. In fact, a product liability suit cannot be maintained against a mere innocent seller of a defective product. Which begs at the obvious follow-up question: what makes a seller “innocent?”
The United States District Court for the District of Colorado was faced with just that question in the recently decided Zapien v. Home Depot, USA, Inc., No. 09-cv-02349-REB-BNB, 2010 WL 3522570 (D. Colo. Sept. 2, 2010). Home Depot rented a sewer snake to the plaintiff, who suffered injuries when it gave him a serious electrical shock. Home Depot filed a motion for summary judgment, claiming that it is an “innocent seller” under the terms of the Colorado products statute.
The “innocent seller” doctrine in Colorado, however, has a few exceptions. First, if the seller knows the product is defective, it is no longer an “innocent.” Second, if the seller alters the product, it is no longer insulated from liability (obviously, because it is no longer just a seller).
There was some tangential evidence in Zapien, based on some comments from a cashier at Home Depot, that the retailer knew that the sewer snake was defective, but the evidence was not allowed on appeal. As a result, Home Depot’s motion for summary judgment was granted.
If you didn’t build it, alter it, or know about it, you shouldn’t be held hostage by a plaintiff who, for whatever reason, can’t pin liability on those who may actually have been responsible for the defect. But if you, as a retailer, alter the product or know something about any problems it has, then it is reasonable that you should be at least partly responsible for any injuries stemming from the product. I acknowledge that “knowledge” is a slippery term that can be stretched, but the general theory is workable. Other states should take note and bring predictability back to retailer liability.

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