A first in Rhode Island

In February 2006 in Rhode Island, a significant blow was dealt to the lead paint industry when plaintiffs won their first case against it.

Following numerous successfully defended suits, the paint manufacturers now face the prospect of further defeats in other States. Here, we take a closer look at the differences and implications surrounding the Rhode Island precedent.

Public Nuisance makes the difference

This time around, the difference has been the cause of action identified by the plaintiffs. Whilst defendants have previously brushed actions including product liability and strict liability aside, they have now been undone by public nuisance suits.  

A public nuisance is broad in its definition, so much so that it appears to have given the plaintiffs the foothold they have long been looking for. It is defined as a nuisance "which affects at the same time an entire community" and crucially does not require the plaintiffs to evidence "culpability by individual defendants". These characteristics of public nuisance appear to be essential, as it is impossible to trace lead paint damages back to a specific time and company. Clearly, this is creating headaches for the defence attorneys.

Where next ?

Whilst the defendants are appealing on several grounds, the momentum does seem to be with the plaintiffs. The New Jersey Supreme Court will soon see a further case, led by the same successful Rhode Island team, against a very similar set of defendants. In addition, the Court of Appeals in California has recently given permission for plaintiffs to pursue a suit seeking funding from lead paint manufacturers to pay clean up costs in a significant number of locations across the State.

High impact  

The resultant impact upon the insurance and reinsurance markets is obvious. There may, however, be wider implications still.   What seems to be emerging is a general swathe of opinion that the potential increase in the public nuisance actions will not only make it almost impossible for plaintiffs to lose, it could directly affect the strength of the paint industry over the coming years.  

Sweeping implications ?

Many are viewing this development as a genuine legal landmark which may well have serious ramifications. Anthony Sebock, a professor of torts at Brooklyn Law School stated, "What is more interesting than the paint case itself is this unhealthy dynamic - where very aggressive and, to my mind, not necessarily faithful readings of the common law - generates decisions that are quite weak…".  

Whilst the potential increase of successful public nuisance claims may well provide a mechanism for resolving the lead paint problem, it does seem that the extension of liability for the lead paint industry threatens the strength of the industry itself. Further, and with equal significance, it could well affect other industries too. The insurance and reinsurance markets are watching developments closely.