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BCA Praises Legislature for Reversing Alabama Supreme Court’s “Innovator Liability” Decision

MONTGOMERY, Ala. – The Business Council of Alabama today praised the Alabama Legislature for giving final passage to SB 80, by Sen. Cam Ward, R-Alabaster, which overturns the Alabama Supreme Court’s adoption of a novel legal theory that could have could have hurt Alabama’s businesses and the state’s business climate.

“By passing this important legislation, the Alabama Legislature has stood with Alabama’s businesses by reversing the Alabama Supreme Court’s adoption of a novel tort theory, which could have had chilling effects on Alabama’s business climate,” said BCA President and CEO William J. Canary. “On behalf of Alabama’s businesses, the BCA thanks the legislative leadership along with Sen. Cam Ward and Rep. Jack “J.D.” Williams for promptly correcting this wrong.

“Had this not been swiftly corrected by the Legislature, Alabama would have been at a great disadvantage in attracting new business investment, which is key to bringing economic growth and jobs to our state,” Canary said.

The legislation garnered wide bipartisan support in the Legislature. The Senate had passed SB 80 32-0 and the House previously voted 88-7 to pass its version, HB 110, sponsored by Williams, R-Vestavia Hills. Williams handled Ward’s bill in the House.

Today the House voted 86-14 on final passage of SB 80 and sent it to the governor for consideration.

SB 80 only became necessary after the Alabama Supreme Court shocked everyone in 2013 in the Weeks v. Wyeth case and then again on rehearing the same case in 2014. The court held that a brand-name drug manufacturer can be liable—on a “fraud” theory—for physical injuries caused by a generic drug product that it neither made nor sold.

“Alabama manufacturers are fortunate that this legislation will now be law,” said Tommy Lee, BCA First Vice Chairman, and President and CEO of Vulcan, Inc., a manufacturer in Foley, Ala. “To think that a company could be held liable for injuries allegedly caused by a product it neither manufactured nor distributed is alarming, and we thank Speaker Hubbard and Pro-tem Marsh for making this pro-business bill a priority.”

The BCA filed a brief in the Weeks case along with the U.S. Chamber of Commerce, urging the Supreme Court to reverse itself and warning that adoption of the aberrant “innovator-liability” theory would once again make Alabama a magnet for frivolous lawsuits.

After the Supreme Court refused to right its own wrong in the 2014 rehearing, Senator Ward sponsored legislation to restore common sense to the law. SB 80 is an important legal reform that returns predictability to the tort system and reaffirms settled expectations for companies doing business in Alabama.

Before the Supreme Court’s 2013 decision in Weeks, this so-called “innovator liability” theory—which frees up plaintiffs to circumvent age-old product-liability limitations—appropriately had been relegated to the judicial trash heap.

More than 100 decisions applying the laws of 30 states, including every state bordering Alabama, flatly rejected the “innovator liability” theory that the Alabama Supreme Court embraced. In defying that overwhelming national consensus, the Supreme Court aligned Alabama with outlier decisions from California and Vermont.

The Business Council of Alabama is Alabama’s foremost voice for business. The BCA is a non-partisan, statewide business association representing the interests and concerns of nearly 1 million working Alabamians through its member companies and its partnership with the Chamber of Commerce Association of Alabama. The BCA is Alabama’s exclusive affiliate to the U.S. Chamber of Commerce and the National Association of Manufacturers.

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FOR IMMEDIATE RELEASE: April 28, 2015

Contact: Nancy Wall Hewston or Dana Beyerle (334) 834-6000

 

About Nancy Hewston

Nancy Hewston
Vice President of Communications, Strategic Information and Federal Affairs
334-240-8725 | Fax: 334-241-5984
Email Nancy Wall Hewston

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