Products are commonly recalled due to a hazard (i.e., a risk of harm), even where large swaths of consumers have never had a problem with the products they purchased. When those consumers then file suit, they often seek to recover economic harm based on the “benefit of the bargain” theory—because the recalled products that they previously purchased are now worth less than what they paid for them. Where a consumer does experience the hazard (i.e., suffers personal injury or property damage) and subsequently files suit, that suit often seeks to recover not just economic harm but also for personal injury or property damage. Regardless of the nature of the harm, the alleged injury naturally precedes any recall of the product.
But that is not always the case. In late May, an insurance company filed suit against Electrolux Home Products, Inc. (“Electrolux”) for property damages allegedly caused by a dehumidifier several yearsafter that humidifier had been recalled. In Church Mutual Insurance Co. S.I. v. Electrolux Home Products Inc., No. 5:23- cv-01972 (E.D. Pa.), the Church Mutual Insurance Company sued Electrolux on behalf of its policyholder, Mount Zion Lutheran Church Krumsville, seeking to recover over $1 million for smoke, fire, and water damage after a dehumidifier allegedly failed on April 4, 2022. The dehumidifier, which had been donated to the church at some unknown time, was recalled in November 2016.
At the time of the recall, consumers were directed to immediately turn off and unplug their products and contact the manufacturer for a replacement or partial refund. Neither the donor of the dehumidifier nor the church apparently heeded these instructions. And the church was operating the dehumidifier as recently as five and a half years after the CPSC announced the product recall. The complaint, however, does not take aim at the execution of the recall and allege, for example, that consumers were not sufficiently put on notice. Instead, it asserts negligence and strict products liability claims based on the sale of an allegedly defective product.
Given the timing of the recall and the alleged injury, Church Mutual will be an interesting case to watch, as it is bound to raise questions regarding who bears the responsibility—the manufacturer, the consumer, or someone else in the distribution chain—for alleged harms that occur long after consumers have been warned of the potential hazard and the products have been taken off the market.