A House panel is set to take up a piece of legislation this week that would give American consumers the ability to sue foreign manufacturers in U.S. courts for injuries resulting from dangerous or defective products, according to The Dow Jones Newswire.
The Foreign Manufacturer Legal Accountability Act, introduced by Rep. Betty Sutton and co-sponsored by more than 60 representatives of both parties, is a response to a rash of defective and dangerous foreign products that have flooded the American market in recent years.
"If foreign entities have the benefit of selling products and making profits from sales in the U.S., they should be accountable if the product causes harm," Ami Gadhia, policy counsel for the Consumers Union, said in a House hearing last month, according to the Newswire.
As the law currently stands, it is extremely difficult to sue a foreign company in an American court. Even if a lawsuit is filed and litigated, some foreign companies will not even acknowledge the legal action, fail to accept jurisdiction in U.S. courts and neglect to pay any awarded damages.
More often than not, it is the U.S. distributors and retailers that are stuck to foot the bill for their foreign suppliers.
"When consumers aren't able to hold the foreign manufacturer accountable, it kind of forces them to have go to the U.S. business that sold the goods or supplied the goods," Christine Zinner, associate director of public affairs for the American Association for Justice, told the Public News Service. "That's why this legislation really helps level the playing field for U.S. businesses."
The legislation would require, as a condition of market access, foreign companies to identify a registered agent to accept service of process on behalf of non-U.S. manufacturers. Doing so would constitute an acceptance of jurisdiction in U.S. courts.
The rules would be applied to all products regulated by the Environmental Protection Agency, the Food and Drug Administration and the Consumer Product Safety Commission.
Perhaps the most important effect the legislation could have would be to deter foreign companies from taking shortcuts in making products to be exported to the U.S. If that is the case, it could seriously cut down on the amount of foreign-made goods recalled. Last year, 83-percent of the defective goods recalled were produced overseas.