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Products liability, corporate structure, and bankruptcy: Toxic substances and the remote risk leadership

Schwartz, Alan (1985) Products liability, corporate structure, and bankruptcy: Toxic substances and the remote risk leadership. Journal of Legal Studies, 14 (3). pp. 689-736. ISSN 0047-2530.

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This paper addresses the interaction of three seemingly unrelated issues. Each is important in its own right; their interaction poses of overwhelming magnitude for our legal system. The three are: (1) In products liability law, should firms be made to bear risks are difficult to foresee? If no one knew that widgets cause scrofula, they do, should widget manufacturers be liable to scrofula victims? Corporate law, to what extent should limited liability isolate firm from products liability victims? Can company X create a subsidiary produce dangerous products and escape liability for the resultant injuries? (3) In bankruptcy law, at least since 1979, can persons exposed to substances assert claims in the manufacturer's bankruptcy if injuries had not materialized by then? If Smith purchases a drug company X in 1980, company X files a bankruptcy petition in 1981, the drug sometimes causes injury to users years after ingestion, far healthy Smith assert a claim in X's

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Additional Information:© 1985 The University of Chicago Press. This paper was improved by helpful comments made at the U.S.C. Law Center Faculty Workship, a seminar concerning toxic risks held at the California Institute of Technology, a law and economics workshop at the University of Chicago, and a faculty workshop at the Boston University Law School. The paper also benefited substantially from conversations with Kim Border and Jennifer Reinganum, and from comments on earlier drafts by Robert Bone, Jules Coleman, Richard Craswell, Thomas Jackson, Will Jones, Stephen Morse, George Priest, Margaret Jane, Roberta Romano, Steven Shavell, Gary Schwartz, Robert E. Scott, Matthew Spitzer, and James Strnad. Formerly SSWP 542.
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Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:83180
Deposited By: Jacquelyn Bussone
Deposited On:15 Nov 2017 23:36
Last Modified:03 Oct 2019 19:03

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