January 1, 2008

Product Liability Audit

In addition to defending product liability claims and lawsuits, we have also found an increasing need and desire by our clients, past and present, to counsel them to prepare for their first product liability claim or suit and or their next one before they happen (and they will happen). Most clients see the need for this service after their first suit as they see how woefully under prepared they are for scrutiny into areas that they had no idea would become an issue in litigation. So in addition to the more product intensive consulting on the product development and regulatory compliance side, the Product Liability Audit is more comprehensive. It covers the product aspect as well as the legal, discovery, insurance, and contractual elements and rounds out the total product defense and marketing strategy.

In addition to touching on all the product development and regulatory compliance issues, the purpose of the audit is twofold: to locate areas where there are weaknesses in the company product, strategy or defense position, and secondly to address the issues where there are weaknesses or deficiencies (should your company desire to move into the second phase of the audit). The Audit can be a thumbnail sketch of the problems or a more detailed approach depending on many factors, including but not limited to the size of your company and the complexity of your product line and/or service.

This "legal" aspect of the audit involves advising on various matters such as deposition strategies and PMK selection, document and email creation, distribution, retention policies, procedures and strategies, avoiding the creation of "bad" documents, current, former and whistle blower employees, press release issues and crisis management plans, public and media relations, web strategies, marketing issues and strategies, sponsorship and team issues, supplier issues (especially if they are non USA based), agreements and insurance with or for distributors, retailers and suppliers or manufacturers, insurance and broker issues, (including limits issues, types of coverages. deductibles and Self Insured Retentions "SIR's"), claims management, risk management, corporate organization and corporate structures and record keeping, asset protection and preservation, MSRP and SRP issues, and warranty issues to name a few areas we examine. All of these issues are looked at under today's electronics real time environment.

Upon request we can also break the audit down into subcategories, such as insurance, and only perform an audit on areas of your business which you feel are most important or which might be most lacking. We don't recommend this type of "compartmentalizing" the audit for most clients as oftentimes it is the very things they "think" are "fine" which end up being the biggest lurking liability dangers. For example it would be a good idea to not only expand the audit to your own company's policy but also that of your upstream suppliers as well as all non insurance "agreements" which may affect coverage and or indemnity.

We have assisted many manufacturers, distributors and retailers in performing audits encompassing all or some of the foregoing elements. We have participated in seminars and written published articles on these and related topics. Call us and see if we might be able to assist your company. We suggest getting started well before the first claim arrives. The piece of mind it will give you will be well worth it.

Law Offices of Steven W. Hansen | www.swhlaw.com | 562 866 6228
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