The doctrinal unity of alternative liability and market-share liability.

AuthorGeistfeld, Mark A.

Market-share liability has been one of the most controversial doctrines in tort law, with a strong plurality of courts rejecting the doctrine on the ground that it radically departs from the fundamental tort principle of causation. Courts that have adopted this liability rule, though, believe they are adhering to the principle of causation. In, the first case to adopt market-share liability, the California Supreme Court claimed that the liability rule is grounded upon an extension of alternative liability, a doctrine that has been accepted by virtually all jurisdictions. The court never adequately explained how alternative liability can be modified to yield market-share liability, and the only explanation provided by torts scholars involves redefining the tort right to permit compensation for tortious risk, conditional upon the occurrence of injury, rather than for the injury itself. However, courts do not conceptualize the tort right in these terms, for otherwise the doctrine of market-share liability would be uncontroversial. As this Article shows, market-share liability can be derived from alternative liability in a manner that neither redefines the tort right nor departs from the principle of causation. Alternative liability permits the plaintiff to prove causation against the group of defendants. This characterization of the causal rule has been recognized by some torts scholars, but has never been justified. The Article shows that evidential grouping is a defensible principle implicit in numerous cases involving analogous causal problems, including the asbestos cases. Evidential grouping not only explains the doctrine of alternative liability, it shows how a modification of that liability rule yields market-share liability largely for reasons given by the California Supreme Court. This conceptualization of alternative liability and market-share liability also explains the otherwise puzzling liability rule adopted by courts in the asbestos cases. Due to this doctrinal unity, the widespread acceptance of alternative liability should make market-share liability more widely acceptable.

INTRODUCTION I. ALTERNATIVE LIABILITY AND EVIDENTIAL GROUPING A. The Puzzle of Alternative Liability B. Evidential Grouping in a Principled Manner C. Evidential Grouping as the Basis for Alternative Liability II. MARKET-SHARE LIABILITY AND EVIDENTIAL GROUPING III. FURTHER IMPLICATIONS OF EVIDENTIAL GROUPING A. Simultaneity B. Number of Defendants C. Proximity D. Apportionment of Liability and the Joinder Requirement E. Proof of Risk Contribution F. The Plaintiff's Causal Responsibility CONCLUSION INTRODUCTION

The doctrine of market-share liability may have deep implications for tort law. The reason involves the element of causation. To establish tort liability, the plaintiff must prove by a preponderance of the evidence that the defendant's tortious conduct caused the injury for which she seeks compensation. (1) The element of causation ties the violation of the plaintiff's tort right to the defendant's breach of duty, entitling the plaintiff to receive compensation from the defendant wrongdoer. A difficult causal question arises when a plaintiff can sufficiently prove that multiple manufacturers acted tortiously by selling defective fungible products, each of which may have caused the plaintiff physical harm and one of which did, but the plaintiff cannot identify the particular manufacturer that sold the injury-causing product. In the seminal case Sindell v. Abbott Laboratories, the California Supreme Court held that the plaintiff could recover against such a group of manufacturers comprising a "substantial share" of the relevant market. (2) As the court subsequently made clear, this doctrine of market-share liability imposes several liability upon each defendant manufacturer in proportion to its market share. (3) A manufacturer that had ten percent of the relevant market, for example, would be severally liable for ten percent of the plaintiff's harm. According to the preponderance of the evidence, this manufacturer did not cause the plaintiff's harm; the evidence only establishes that the manufacturer created a ten percent chance of causing the injury. The defendant manufacturer may thus be incurring liability only for the tortious imposition of risk, with the profound implication that the plaintiff's tort right involves protection from risk rather than protection from physical harm.

Market-share liability is commonly understood in precisely this fashion. In a series of influential articles, leading torts scholars have argued that market-share liability is based upon an emergent risk-based conception of tort liability that is formulated to promote deterrence in a fair manner. (4) A deterrence-based torts system devises liability rules in order to reduce unreasonable risks. That objective does not depend upon the occurrence of physical harm, because an actor who faces liability for creating an unreasonable risk has an incentive to act reasonably. (5) But when the liability rule instead requires that the unreasonable risk must actually cause physical harm, the actor can avoid liability in conflict with the deterrence objective. The unreasonable risk may not materialize into injury. The unreasonable risk may not double the underlying risk of injury, making it impossible for the plaintiff to prove that the physical harm, more likely than not, was caused by the tortious conduct rather than by the underlying risk of injury. Or the plaintiff may only be able to identify the group of actors who created the tortious risk but not the particular actor who caused the physical harm, as in the market-share cases. These safety problems could be avoided if the plaintiff can establish liability by proving that the defendant exposed her to an unreasonable risk of physical harm. This form of liability is also fair insofar as the moral quality of a defendant's behavior does not depend upon the fortuity, or "moral luck," of whether the unreasonable risk caused physical harm. Rather than distinguish among otherwise identical actors on the contingent basis of whether their unreasonable behavior caused physical harm, tort liability could treat each actor equally by making each responsible for her own behavior--the unreasonable risk she imposed upon the plaintiff. (6)

A pure risk-based liability rule has two substantial practical problems that are avoided by market-share liability. First, once liability no longer depends upon the occurrence of physical harm, there will be a huge increase in the number of suits. Second, plaintiffs who were exposed to the same risk will receive the same damages, regardless of whether they actually suffer the physical harm. To reduce the number of lawsuits and increase the amount of compensation available to the physically injured victims, a risk-based tort rule can be conditional upon the occurrence of physical harm. Only those individuals who were exposed to the risk and suffered the type of physical harm threatened by the risk can recover. If the underlying risk were 1 in 10,000, for example, the harm requirement ordinarily would yield 1 claim for every 10,000 individuals exposed to the risk, whereas a rule lacking that requirement would produce up to 10,000 claims. The reduced number of claimants also increases the amount of compensation for the physically harmed victims. For example, an injured plaintiff could sue a single manufacturer having ten percent of the market and recover damages for ten percent of the total harm. Even though the plaintiff was exposed to a small risk of injury (1 in 10,000), given that she has been physically harmed, the likelihood is ten percent that this particular manufacturer caused the harm. By conditioning liability on the occurrence of physical harm, market-share liability can reduce the number of suits, increase the amount of compensation for physically harmed victims, and still compensate the plaintiff for risk exposure and not for the injury itself--the evidence only establishes the risk exposure, conditional upon the occurrence of physical harm, and does not prove that the ten percent risk actually caused the injury.

Despite the appeal of market-share liability, the doctrine has had a mixed reception in the courts. The prototypical case for market-share liability involves the synthetic drug diethylstilbestrol (DES). A "number of courts" have adopted market-share liability in these cases, but a "roughly equal number of courts have declined to craft a new theory for DES plaintiffs, expressing concern that to do so would rend too great a chasm in the tort-law requirement of tactual causation." (7)

As this case law reveals, the courts do not conceptualize market-share liability as providing compensation for exposure to a tortious risk. A DES plaintiff typically can prove that each defendant DES manufacturer, more likely than not, exposed her to a tortious risk that may have caused the physical harm. By establishing that a defendant manufacturer had ten percent of the relevant market, for example, the plaintiff has proven that this defendant exposed her to a ten percent chance of causing the physical harm. The causal requirement would be satisfied, then, if the tort compensation were for the risk exposure, conditional upon the occurrence of the physical harm, rather than for the harm itself. Courts, however, have concluded that market-share liability would "rend too great a chasm," implying that the liability must be based upon the tortious infliction of physical harm. The fact that a defendant DES manufacturer had ten percent of the relevant market does not prove that its product, more likely than not, caused the plaintiff's bodily injury. The tort right must protect individuals from physical harm in order for so many courts to conclude that market-share liability "requires a profound change in fundamental tort principles of causation.... [W]e cannot pretend that...

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