LIABILITIES OF ENDORSERS, TRADE ASSOCIATIONS, OR SIMILAR PARTIES WHO APPROVE A PRODUCT IN THE OUTDOORS RECREATION INDUSTRY

By Jim Moss

Recently different outdoor recreation groups, organizations, and individuals have been considering or are currently promoting certification. Manufacturers are looking at trade associations to license or promote their products. Organizations are endorsing outdoor programs of their members. Most of these are done with the intention of providing a defense to a lawsuit, to standardize manufacturing or in some cases to promote a particular program. As always, with each new rule or regulation comes a noose to hang the unwary program or manufacturer.

This three-part article will not argue the pro's or cons of providing certification or endorsement of a program. The article will discuss the liability of the organization that offers the endorsement, trade associations or certifications.

An endorser is someone who, for a fee, promotes a product, idea or program. Endorsers usually allow the use of their endorsement for marketing the product. The endorser knows that the product or program receiving the endorsement intends to use the endorsement to increase sales or promote itself. Endorsers are liable if they test a product and offer their endorsements as proof of same evaluation or level of quality. Examples of endorsers are the Good Housekeeping Seal and Underwriters Laboratory. Endorsers face the greatest liability.

Endorsers, certifiers or trade associations' actions are usually not scrutinized past the issue of an endorsement as much as the relationship and the expectations of the person who is injured and is suing. If the injured party relied on the actions, representations or trade associations and the party knew the consumer would rely, liability will probably be found.

Trade associations are rarely reliable for the acts of their members. They do not promote a product or program. Their purpose as defined by their preamble, articles of incorporation or purpose are to promote an industry, not products. Trade associations usually promote their industry rather than their products. Trade associations have been drawn into numerous lawsuits when they knew a product used by the industry or in some cases by one company were dangerous and marketed as safe or marketed without adequate warnings. This has happened in the tobacco industry, chemical industry, and printing industry to name a few.

In the middle fall a host of ideas and programs. Usually run by a trade association or industry organization they offer everything from brochures to the public to approved courses or programs. Liability for their actions or inaction is predicated on how they are perceived or used by the consumer, not on how they are promoted.

The greater the involvement or relationship with the party the endorser or trade association is helping to promote, the greater the liability. Associations or endorsers who are not independent but are part and parcel of their members cannot raise a defense of lack of privity. Privity is the legal term meaning there is no relationship between the injured party and the association or endorser. The closer an organization or trade association aligns its actions to an endorsement program, in general, the greater the liability.

Cases that have prompted winning lawsuits center around actual products that have been endorsed or approved and placed in the stream of commerce. Good Housekeeping magazine was sued when it endorsed a shoe. The plaintiff slipped and fell while wearing the shoe. She testified she had bought the shoe based on the endorsement of the Good Housekeeping magazine. Because the magazine had been paid for the endorsement, the endorsement was on the product as well as the advertising of the product and because the magazine knew the customers would rely on the endorsement the court held the magazine liable.

Underwriters Laboratory has been sued several times successfully. The lawsuits are based on the laboratories approving a product that later injures someone or not testing the product adequately. In each case the injured party relies on the laboratory testing. In some cases, because of a city, fire district or other government requirements required a tested product, the laboratories were held to a higher standard.

With respect to the outdoor industry, liability is a possibility for several current actions. Climbing equipment that is tested by an American laboratory or trade association would create a standard of defense in the industry. It would also create a level of absolute liability for failing to satisfy that level. Any failure of the testing organization would then create another level of liability.

Certification is currently a rage in at least two outdoor industry programs: climbing by the AMGA and general backcountry by WEA. Without in this article exploring the specific actions of either AMGA or the WEA, both could be liable for the actions of a program they certify. If a participant is injured in an approved or certified program, the individual relied on the certification or approval as a major reason why they chose the course or program, and the injury occurred in an action that an expert would say was not the right way to do something, liability could arise.

Additionally, the possibility could arise that the program that was certified, did not meet the expectations of the participant. If the participant was sold on the programs offered by the certifier, then went looking for a certified program because of the claims of the certifier, liability may arise because the program did not meet the claims of the certifier.

Finally, liability will arise if the association or certifier certifies an improper program or knows a program is not adhering to standards of the certifier. In the first situation the certifier should probably be held liable for letting down every other program and placing the industry at risk. In the second scenario, the program is faced with the revoking its certification and announcing the revocation.

The difficulty for the outdoor recreation industry is wanting to achieve a level of professionalism and safety. The author is also not saying that testing, certification or endorsing products is a bad idea. The purpose of the article is to explain another level of liability that may be emerging in the Outdoor Recreation industry. Next issue we will review what the courts say will prevent liability and how that applies to specific outdoor recreation industry actions. The final article will deal with individuals who certify for themselves or for an organization.