Understanding Colorado’s “Innocent Seller” Statute in Product Liability Actions

Posted by Jeremy Rosenthal | Dec 20, 2016 | 0 Comments

Product liability cases seek to hold those who make products accountable for injuries their products cause. The broad intent is that our communities will be safer if manufacturers more rigorously evaluate and determine their product's safety, because of potential liability for unreasonable conduct. Product liability is a strict liability tort, meaning liability that doesn't need to be proven to have been executed with harmful intent; rather, the plaintiff need to establish only that they were harmed by the defendant. It is important to differentiate product liability action from breach of warranty or contract claims. Product liability actions are pursued because a product may have caused injury, death, or property damage. Products which are merely ineffective or defective in their function or purpose are matters of contract law.

Defining Product Manufacturer vs Seller

The CO Revised Statutes define the manufacturer as being an entity who designs, assembles, constructs or by some means prepares a product or part before it enters the distribution or sales channel. For purposes of product liability actions, this also includes sellers who are aware of product defects, have control over aspects of manufacturing, or who alter or modify the product before selling it. This additionally includes sellers that are owned in some manner by the manufacturer, such as retailer. A seller is purely an entity who conducts business by selling or leasing products.

Innocent Seller Statute

A seller of a product or part is not subject to product liability actions unless they are also the manufacturer. In situations where a manufacturer is outside of the jurisdiction, the principal seller or distributor within the jurisdiction will be considered such.

CO Appeals Case: Shaw v. General Motors Corp

General Motors (GM) manufactured the cab and chassis of a truck which was sold through Daniel Motors (DM) to the City of Colorado Springs. Fontaine Truck Equipment (FTE) installed a dump bed and hoist and made further modifications at the city's request. A city employee was injured when a co-worker backed into him. The city argued that the truck was defective because it did not have a “backing up” alarm. The findings for the three defendants were:

  • GM: The cab and chassis could be potentially modified for many uses. When the cab and chassis left GM, there weren't dangerous conditions. It is not GM's responsibility to foresee all possibilities and be ultimately responsible.
  • DM: Was shielded by the innocent seller statute.
  • FTE: There was no reasonable likelihood of an accident that resulted from FTE's “failure to warn”; therefore, the product is not unreasonably dangerous. The City of Colorado Springs purchased the parts, designed, and had the final product assembled, thus the burden fell on them.

Have you been injured as a result of a defective product? Colorado law allows for recovery through actions of product liability. The Law Firm of Jeremy Rosenthal has been successfully obtaining economic justice for product-related injury victims in Colorado for many years. Take the first step to recovery today by contacting the office for a consultation.

About the Author

Jeremy Rosenthal

Attorney Jeremy Rosenthal is dedicated to helping his clients seek just compensation for their injuries regardless of the lengths he has to go to or the distances he may have to travel in order to get it.


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