California Expands Tort Liability under the Novel Market Share Theory

The California Supreme Court, in the novel and unprecedented case of Sindell v. Abbott Laboratories, eliminated the plaintiffs burden of identification of a negligent party, and thus the causation requirement, in a multiple party tort action. In the course of this decision, the court adopted the “market share” theory of liability which dictated in Sindell that nonidenti iable defendant-manufacturers of the generic drug DES would be liable for the damages in proportion to their share of business in the market. The author thoroughly examines various theories of recovery, such as “alternative liability,” “concert of action” and “enterprise liability,” which the court employed in their formulation of the ‘market share” theory. While in agreement with this decision, the author analyzes the majority and dissenting opinions and notes the benefits and shortcomings of this most controversial development in California tort law.


Until recently, the vast majority of women who had developed cancer due to their mother’s ingestion of the drug diethystilbestrol (DES) during pregnancy were unable to recover damages because of their inability to identify the responsible manufacturer. However, the California Supreme Court, in Sindell v. Abbott Laboratories, has pioneered a new theory of recovery which permits a DES daughter to recover damages without naming a specific manufacturer-defendant. This four to three decision will likely have far-reaching consequences in the field of products liability by in effect removing causation in certain situations as a required element of proof.

California Expands Tort Liability under the Novel Market Share Theory: Sindell v. Abbott Laboratories, Pepperdine Law Review, Volume 8 | Issue 4 Article 4, 5-15-1981.

Before discussing the significance of Sindell with regard to the expansion of manufacturer’s liability, the special nature of DES cases will be noted. Next, both the history and the court’s treatment of each theory of applicable established tort law will also be discussed, in addition to a review of the market share theory, adopted by the Sindell court. Finally, both the advantages and drawbacks of the market share theory, and its potential impact on future cases in the field of products liability will be analyzed.



DES, a synthetic compound of the female hormone estrogen, was approved on an experimental basis in 1947 as a miscarriage preventative. DES was manufactured, promoted, and marketed from 1947 to 1971 by hundreds of drug companies,  including the respondents in Sindell. In 1971, as a result of statistical data showing a significant correlation between the use of DES and the subsequent development of cancer in the daughters of mothers who took the drug during pregnancy, the FDA “banned” the use of the drug for the purpose of preventing miscarriages, because of its danger and ineffectiveness.

Presently, several hundred young women whose mothers ingested DES during pregnancy are suffering from a DES-induced cancer known as clear cell adenocarcinoma. Heretofore a relatively rare form of cancer it is believed to strike after a minimum latent period of 10 to 12 years and generally appears in the vagina, cervix and uterus. The vast majority of DES daughters who have not developed cancer are suffering from other abnormalities, the most prevalent being adenoses.

B. The Facts in Sindell

The appellant, Judith Sindell, filed suit against several drug companies for personal injuries sustained as a result of prenatal exposure to DES. Sindell sued on her own behalf and as representative of a class of other women in California similarly situated. The Sindell case is just one of many actions that has been brought in recent years by DES daughters, most of whom have already developed clear cell adenocarcinoma. Sindell, as a result of DES exposure, developed a malignant bladder tumor which was surgically removed.  She also continues to suffer from adenoses, which requires that she be frequently monitered by biopsy or colposcopy to insure early warning of further malignancy.

Among Sindell’s allegations were that each defendant knew, or should have known, that DES was carcinogenic at the time of its manufacture and sale, and that the defendants acted in concert in the manufacture and promotion of DES for the prevention of miscarriage without adequate testing or warning, and without monitoring or reporting its effects.  Sindell further alleged that each defendant undertook a program to market DES on a “wide-open basis” for the prevention of miscarriage, notwithstanding the fact that it was only conditionally approved by the FDA and that each defendant continued to market DES after learning of its carcinogenic properties. However, in her complaint, and subsequdntly throughout her trial and appeals, Sindell was unable to name a specific manufacturer responsible for her injuries.

The trial court sustained the defendant’s demurrer to the complaint and dismissed the action, primarily because of Sindell’s inability to name the responsible manufacturer. On appeal, the court of appeal reversed the trial court, finding a cause of action under both the alternative liability and concert of action theories. The defendant’s subsequent appeal resulted in the California Supreme Court decision which is the subject of this case note.

C. The Issue Presented

Although many legal issues are involved in DES cases in general, the Sindell court restricted its discussion to the following issue: “May a plaintiff, injured as the result of a drug administered to her mother during pregnancy, who knows the type of drug involved but cannot identify the manufacturer of the precise product, hold liable for her injuries a maker of a drug produced from an identical formula? The California Supreme Court believed public policy required an extension of traditional products liability doctrine to provide for an adequate remedy in such situations. In order to accomplish this extension, the court adopted a novel theory of liability in tort law.

Before discussing the Sindell court’s analysis of this complex legal issue, a brief explanation of the various theories of liability which have permitted plaintiffs to recover despite the inability to name a specific defendant is necessary.


Although DES cases involve several legal problems, such as class action certification, statute of limitations, possible absence of a cause of action for fetal injury prior to viability, and possible absence of a cause of action because the danger of the drug was unknown at the time of manufacture, the Sindell court saw the identification of the manufacturer, or causation issue, as the major problem facing potential plaintiffs.

Because of the significant time lapse between the intake of the DES, the manifestation of the injury, and the time period which elapses before DES is discovered to be the causative agent, most plaintiffs are unable to positively identify the specific manufacturer of the drug ingested by their mothers.

The general rule in tort liability is that the plaintiff has the burden of proof on the issue of causation with the responsibility of showing that his or her injuries were caused by the act of the defendant or by an instrumentality under the defendant’s control. This rule applies whether the injury occurred as the result of an accidental event or from the use of a defective product.

There are several exceptions to this general rule, two of which may be applicable to the Sindell situation. These two exceptions are “concert of action” and “alternative liability. A third basis of liability, “industry-wide” or “enterprise liability, has also been considered in the resolution of DES cases. All of these theories, under certain circumstances, may support a plaintiff’s action even if the responsible defendant is not specifically named or identified, and all were considered as possible solutions by the Sindell court. Thus, each of these theories will be discussed in detail before the adopted “market share” approach is analyzed.

A. Alternative Liability
1. History

The unanimous decision of Summers v. Tice best exemplifies the theory that has been termed double fault and alternative liability. This theory states that, where all defendants behave tortiously, but the plaintiff is unable to identify the specific defendant that causes his or her injury, the burden of proof is shifted to each defendant to show that he is not the responsible party. Where the defendants are unable to meet this burden, joint and several liability results.

In Summers, the plaintiff was injured when two hunters simultaneously and negligently fired their guns in the plaintiff’s direction. The plaintiff could not ascertain which of the defendants actually caused the injury, but the court nevertheless held that both defendants were jointly and severally liable. The Summers court refused to apply the concert of action theory,  by stating that to do so would be straining that concept. The court developed instead the concept of alternative liability, based on the following policy consideration: if the plaintiff is forced to identify the responsible defendant, there is the possibility that the wrong defendant will be identified, conceivably leaving the injured plaintiff without a remedy. Because of this inequitable result, the burden of proof should shift to the defendants, “each to absolve himself if he can.

This rule of alternative liability developed by the Summers court has been adopted by the Second Restatement of Torts. The Restatement notes that the policy underlying the rule is the injustice of permitting proved wrongdoers, who among them have inflicted an injury upon the entirely innocent plaintiff, to escape liability merely because the nature of their conduct and the resulting harm has made it difficult or impossible to prove which of them has caused the harm.

In formulating the alternative liability theory, the Summers court relied upon the celebrated case of Ybarra v. Spangard. In Ybarra, the plaintiff sustained an injury while unconscious during the course of surgery. The court decided that it would be an unfair burden to require the plaintiff to identify the person or persons who caused his injury, because his inability to identify the specific causative factor was a direct result of actions of the defendants. Therefore, the court, by applying the doctrine of res ipsa loquitur found that an inference of negligence had arisen that required the defendants to explain their conduct.

2. Appellant’s Reliance on Alternative Liability

In Sindell, the appellant placed primary reliance on the Summers and Ybarra decisions to show joint or alternative liability on the part of the defendants. For example, the appellant maintained that the Ybarra decision went one step further than that required of the court in a DES case.

In Ybarra the court may have actually shifted the burden of proof to an entirely innocent non-negligent party. Here we are merely asking the court to follow the doctrine elaborated in Summers and shift the burden of proof to a group of defendants, each and every one of which is a negligent cause of the plaintiff’s inability to identify the specific wrongdoer causing inJury.

The appellant also attempted to compare the Summers fact situation to that of the DES-type of injury. For example, the appellant pointed to the fact that the fungible nature of the shotgun pellets in Summers was what made the identification of the responsible defendant virtually impossible. This was analogized to the situation in Sindell, where the fungible nature of the generic drug DES made it difficult to prove without records which respondent caused the harm to the appellant.

In Summers, the conduct which created the impossibility of identification was the simultaneous discharge of the two defendants’ shotguns. However, in Sindell, the appellant argued that the drug companies, by manufacturing the same drug under a variety of trade names, created a situation in which it was unlikely that any identification could be made. The appellant also contended that the tortious character of the respondent’s conduct in failing to warn of, or discover, the dangers of DES was the major reason why all parties failed to keep better records. Thus, the appellant maintained that the DES injury was an even more compelling situation in which to find liability than that found in Summers.

In developing this theory, the plaintiff relied on Haft v’ Lone Palm Hotel. In Haft, multiple defendants were held liable for the drowning of a young boy and his father in the hotel swimming pool despite the absence of proof of causation. The defendants were held to have been liable for negligence in failing to provide a lifeguard as required by law. Even though there were no witnesses to the accident, the Haft court held that the absence of evidence of causation was a direct and foreseeable result of the defendant’s negligence, and on this basis, shifted the burden of proof to the defendants. Similarly, the appellant in Sindell argued that her inability to identify the responsible manufacturer was a direct and foreseeable result of the defendant’s negligence in their failure to warn consumers of the dangers of DES.

3. Sindell Analysis of Alternative Liability

The Sindell court, in response to the respondent’s allegation that the appellant was in a superior position to identify the responsible manufacturer, stated that neither Sindell nor the drug manufacturers were in a better position to bear the burden of proof of identifying the responsible manufacturer.

The respondents argued that the Summers-Ybarra burden of proof rule was predicated on the defendant’s greater access to information, and since this was not the case in Sindell, alternative liability should not be applied. The court rejected this claim, noting that while “Summers states that defendants are ‘ordinarily … in a far better position to offer evidence to determine which one caused the injury’ than a plaintiff,” this is not necessarily a prerequisite to the shifting of the burden of proof. The court believed that the particular circumstances in Sindell, as in most DES cases, made it virtually impossible for either party to identify the specific wrongdoer.

The court then distinguished the appellant’s reliance on Haft. The court stated that the difficulty or impossibility of the identification of the specific responsible DES manufacturer was not, as argued by the appellant, the result of the respondent’s alleged negligent act of failing to provide adequate warning. Rather, in the view of the court, it was a result of the long passage of time between the act, the ingesting and prenatal exposure to DES, and the resulting subsequent development of cancer.

The Summers theory of alternative liability was rejected by the Sindell court for one major reason: the number of joined and unjoined defendants. In Summers, all parties who were or could have been responsible for the harm to the plaintiff were joined as defendants. However, in Sindell, there were approximately 200 drug companies  that might have produced the injury-producing drug that injured the appellant; of these, only five were ultimately joined as defendants.

The court concluded that an application of the Summers rule to Sindell would not be fair to the respondents. The possibility of any of the respondents causing the injury to the appellant was too remote to require each respondent to exonerate itself, especially with the substantial possibility that the actual offending manufacturer might escape liability altogether. Thus, the court refused to apply the Summers theory of alternative liability.

B. Concert of Action
1. History

Concert of action is another theory by which a plaintiff may obtain joint and several liability. A typical illustration is that of an illegal drag race in which a bystander is injured by one of the participants. Suppose A, B, and C enter into such a race, and P is injured by A’s car. Under the concert of action theory, P may sue A, B, C or any combination of the three.

Prosser defined the concert of action rule as follows:

All those who, in pursuance of a common plan or design to commit a tortious act, actively take part in it, or further it by cooperation or request, or who lend aid or encouragement to the wrongdoer, or ratify and adopt his acts done for their benefit, are equally liable with him.

Thus, in the above example, all P need do is show that “each defendant he has joined helped plan and facilitate the race, that the participation of each was tortious, and that his injury resulted from the race. It should be noted that the participants of the race may still be held under the concert of action theory even though they did not expressly agree to participate in it; “all that is required is that there be a tacit understanding. . . . It is also noteworthy that the definition of “joint tortfeasors” with relation to concerted action applies not only to those who act in concert to accomplish some common goal or plan and thereby cause injury, but also to “those who order, direct or permit others to do the act, and who give assistance or encouragement.  This theory of liability is accepted without dispute in California.

Orser v. George, relied on by the appellant in Sindell, explains the rationale for the use of the concert of action theory as a means to establish the element of causation. In Orser, three defendants were engaged in the tortious conduct of firing their guns in the direction of the decedent. Two of the three were alternately firing a pistol which was later determined to be the weapon that killed the decedent. The third defendant was shooting a rifle, which was not the fatal weapon. The trial court granted the third defendant summary judgment on the basis that he met the alternative liability burden of proof in showing that he was not the responsible defendant. The court of appeal reversed on the issue of whether the third defendant’s tortious conduct in firing the rifle in the direction of the decedent had provided the other defendants with the “substantial ‘assistance and encouragement’ necessary for concert of action liability.

Orser effectively demonstrates the distinction and the added element involved in concert of action as opposed to alternative liability. If a defendant can be shown to have joined with others to facilitate an injurious result, it is irrelevant whether or not he can subsequently meet the burden of proof by showing that he was not personally responsible. Under the concert of action theory, the act of joining in or encouraging tortious conduct is in itself tortious.

The close relationship between concert of action and enterprise liability is shown in Hall v. E. I. Du Pont De Nemours & Co., Inc. Hall involved injuries to thirteen children by dynamite blast caps. The evidence of individual manufacturers was destroyed by the explosions. Alleging that the defendants knew that blasting caps were dangerous and agreed among themselves not to put warnings on the labels, the plaintiffs sued the six major manufacturers of blasting caps and the industry’s trade association. Although Hall was not decided on concert of action, the language used by the court forms a basis for the enterprise theory of liability. Accordingly, Hall will be discussed more fully below.

2. The Sindell Analysis of Concert of Action

The court first addressed the appellant’s charge that the respondent’s parallel- or imitative conduct in their testing and promotion, methods was in itself tortious conduct. The court rejected this contention by pointing out that it is common for manufacturers to borrow testing and sales techniques from other manufacturers in the same industry. Thus, the court refused to set any precedent that might “render virtually any manufacturer liable for the defective products of an entire industry. This was the major reason for the court’s rejection of the concert of action theory, since, in the court’s view, its application in this context would have expanded liability much further than had ever been intended.

The court also distinguished the DES cases from prior concert of action cases cited by the appellant. In particular, the court sought to distinguish Orser. The decision in Orser was based on the encouragement and assistance given by one of the alleged tortfeasors to the other. However, there was no allegation made by the appellant in Sindell that each respondent knew of the other’s tortious conduct, or that they assisted and encouraged one another to inadequately test DES and to provide inadequate warnings in the same manner as in Orser. Thus, the theory of concerted action was rejected.

C. Enterprise Liability
1. History

The concept of enterprise liability was first introduced in Hall v. E. I. Du Pont de Nemours & Co., Inc.. Though Hall and its companion cases were decided on other grounds, the court suggested an expansion of the concert of action theory to include corporate entities, and referred to this expansion as “enterprise liability.” In Hall, the defendants had adhered to an industrywide standard with regard to safety design, labelling and manufacture of the blasting caps. Thus, it appeared that the defendants jointly controlled the risk of injury. If shown by the plaintiffs that the caps were manufactured by one of the defendants, the burden of proof would shift to the defendants.

This novel theory of liability was developed and refined by Naomi Sheiner, while a law student at Fordham University for use within the context of DES actions. In DES and a Proposed Theory of Enterprise Liability, Sheiner proposed that enterprise liability “combines the better features of concert of action and alternative liability into one coherent theory. The elements of the theory as outlined in the article are as follows:

  1. Plaintiff is not at fault for his inability to identify the causative agent and such liability is due to the nature of the defendant’s conduct.
  2. A generically similar defective product was manufactured by all the defendants.
  3. Plaintiff’s injury was caused by this product defect.
  4. The defendants owed a duty to the class of which plaintiff was a member.
  5. There is clear and convincing evidence that plaintiff’s injury was caused by the product of some one of the defendants. For example, the joined defendants accounted for a high percentage of such defective products on the market at the time of plaintiff’s injury.
  6. There existed an insufficient, industry-wide standard of safety as to the manufacture of this product.
  7. All defendants were tortfeasors satisfying the requirements of whichever cause of action is proposed: negligence, warranty, or strict liability.

Once the plaintiff proves these seven elements, the burden of proof as to causation shifts to the defendants, each of which can exonerate itself by showing … that its product could not have been the one which injured this particular plaintiff.

Enterprise liability is similar to alternative liability in that it presumes that one of the defendants caused the plaintiff’s injury, and because of the tortious acts of all defendants coupled with the plaintiffs inability to identify the one who caused the injury, the burden is shifted to the defendant to exculpate himself if he is able. Like concert of action, the plaintiff must prove an additional element in enterprise liability, . . . , one that is derived from the concerted activities of the defendants: the presence of an insufficient industry wide safety standard. In addition to the Restatement’s theory of concert of action and the Summers rule of alternative liability, Sheiner, in developing this proposed theory of liability, relied on both Hall and Ybarra for authority.

The primary rationale that Sheiner advances for enterprise liability is the familiar policy generally found in strict liability cases: “That as between the innocent plaintiff and the tortfeasors, the tortfeasors should bear the cost of the injury. Sheiner relies on the policy considerations of the doctrine of respondeat superior and strict liability, which involve a deliberate allocation of risk to those in the best position to take preventative measures and to absorb and distribute foreseeable costs to the public. In particular, reliance is placed on the landmark decision of Escola v. Coca Cola Bottling Co. , which developed the theory of strict liability in response to the scientific and industrial advances of the time. The Sheiner article suggests that it is now time to advance still another, more far-reaching form of liability.

2. Sindell Analysis of Enterprise Liability

The Sindell court rejected the theory of enterprise liability, at least in form. The court distinguished Sindell from Hall by pointing out that in the latter there were only six manufacturers which represented the blasting cap industry in the United States;  there are at least 200 manufacturers of DES, of which only five were named in Sindell. Moreover, in Hall, the defendants jointly controlled the risk of injury through a trade association; however, in Sindell, proof of control of risk would not be shown by such means.

The court also advanced the policy reason that the drug industry, because of its close affiliation with the Food and Drug Administration, should not be held completely responsible for its industry-wide standards, since those standards are dictated by the government. In its analysis, however, the court failed to consider the fact that although the FDA set the standards for the manufacture and distribution of DES, the manufacturers of the drug failed to follow these standards.

Thus, the court rejected, rather summarily, the third theory of liability offered by the appellant. However, as will be seen below, while the court rejected enterprise liability in form, the substance is strikingly similar to the theory of “market share” liability that the court developed sua sponte.


Although the court deemed the three theories of liability advanced by Sindell insufficient to warrant a cause of action, the court nevertheless held that the appellant should not be precluded from recovery. The court stated that the response of the courts can be either to adhere rigidly to prior doctrine, denying recovery to those injured by such products, or to fashion remedies to meet these changing needs. Therefore, based on major policy considerations, the court established a new theory of causation applicable to a limited number of cases.

Primary authority for “market share” liability was Justice Traynor’s landmark concurring opinion in Escola v. Coca Cola Bottling Co. , which over thirty years ago recognized the then traditional standard of negligence as insufficient to govern the obligations owed by the manufacturer to the consumer.  As in Escola, the policy argument that the manufacturer is better able to bear the cost of an injury resulting from a defective product was also stressed by the Sindell court. It was reasoned in Sindell that from a policy standpoint, holding a manufacturer liable for defects in their products and for the failure to warn of harmful effects, even in the absence of proof of causation, would provide an incentive for product safety, since the manufacturer would be in the best position to guard against such defects.

Although the Sindell court rejected the theories of alternative liability, concert of action, and enterprise liability, it nevertheless borrowed heavily from each of these theories in its formulation of “market share” liability. In its rejection of alternative liability and concert of action, the court apparently preferred not to expand either of these established tort doctrines to the extent that would be necessary in the Sindell factual setting. In contrast, enterprise liability, which is more of a proposed theory than an established doctrine, was relied on very heavily by the court in the adopted “market share” theory.

The major difference between the three theories of liability proposed by the appellant and the “market share” theory formulated by the court, is that “market share”, rather than imposing joint and several liability, imposes only several liability on the defendants. Accordingly, no manufacturer may be held liable for 100 percent of the judgment. Instead, “each defendant will be held liable for the proportion of the judgment represented by its share of that market unless it demonstrates that it could not have made the product which caused plaintiffs’ injuries.” Although the court uses the term “market share” to literally mean “the proportion of the judgment represented by [that defendant’s] share of that market, the court did not state exactly how a defendant’s share of the market would be determined.

The court recognized that some discrepancy between the “market share” apportioned to a defendant and the actual liability of that defendant is inevitable, primarily because of the passage of time involved. However, the court likened this problem to the inability of a jury to precisely determine the relation between fault and liability under the doctrines of comparative fault  or partial indemnity. In practice, it would seem that a defendant’s portion of the market would be more easily defined, because of company records of sales and profits, than a particular defendant’s comparative fault in, for example, a multiple-vehicle accident case, which would necessarily be a more subjective determination because of the lack of factual basis.

The other major problem with the “market share” theory, is that all the potential defendants may not be named. The Sindell court concluded, however, that this was not a major obstacle in this case, since the five named respondents represented approximately ninety percent of the entire market. Thus, there was only a ten percent likelihood that the offending producer would escape liability. The court, therefore, gave the appellant the initial burden of joining a “substantial percentage” of the manufacturers in bringing an action based on “market share” liability. However, the court did not determine what constituted a “substantial percentage,” except to state that in the instant case that the appellant met the burden.

Though the court readily acknowledged the above potential procedural and equitable problems with the theory, it viewed these as relatively minor, considering the alternative of leaving the appellant without a remedy. Thus, it appears that the Sindell court, without specifying it as such, facilitated a type of balancing test in its adoption of “market share” recovery; inconsistencies inherent in the determination of a “substantial percentage” or “market share” are outweighed by the necessity of providing innocent plaintiffs’ with an avenue of recovery.


A strong dissent, written by Justice Richardson, began by stating that the ramifications of the “market share” theory adopted by the court were virtually limitless, with the “elimination of the burden of proof as to the identification [of the manufacturer whose drug injured plaintiff imposing] … a liability that would exceed absolute liability. Justice Richardson cited briefly the prevailing authority on tort law, as well as other DES cases in support of this position.

The dissent painstakingly examined the majority’s decision, showing, one by one, the problems inherent in the “market share” theory. First, although the court stated that the requirement of proof is satisfied by joinder of those defendants who have together manufactured a “substantial share” of the market,  it failed to establish a guideline or method of determining what constitutes a “substantial share.  Although the dissent believed that this should have been specifically determined by the court, the dissent did not appear to consider this a major deficiency in the decision compared to the other problems with “market share” recovery.

More significantly, the dissent was concerned with the consequences of what it terms the “unprecedented extension of liability” advanced by the theory. For example, a particular defendant, having a very small share of the relevant market, could “be held proportionately liable even though mathematically it is much more likely than not that it played no role whatever in causing plaintiff’s injuries. This would allow the plaintiff to “pick and choose their targets, with the defendants, who are held to be liable, named according to whatever method the plaintiff chooses, rather than by the possibility or likelihood of liability. While this may be a legitimate concern, it seems more likely that a potential plaintiff unable to identify a responsible defendant would name those companies most readily identified as DES manufacturers, with a corresponding large share of the market, rather than those minor companies who participated in an extremely small portion of the market.

The dissent also pointed out the practical consideration of the disproportionate impact on those manufacturers who are amenable to suit in California, since it is possible that no other state will adopt the market share theory. In this situation, those manufacturers brought to trial in California would be, in effect, jointly responsible for 100 percent of plaintiffs’ injuries although those manufacturers ‘substantial’ aggregate market share may be considerably less.

Finally, the dissent criticized the theory as contrary to the social policy that encourages the development of new pharmaceutical drugs. Justice Richardson reasoned that the decision of liability based on market share would inevitably inhibit, if not the research or development, at least the dissemination of new pharmaceutical drugs. This, he stated, was totally inconsistent with the policy of traditional tort theory as advanced in the Restatement. While Justice Richardson’s view is shared by several authorities, it has been controverted by others.  This conflict of opinion will be discussed more fully below.

The dissent concluded by suggesting, in view of the sweeping possibilities of the market share theory as applied to other areas of business and commercial activity, that this extreme departure from traditional tort law should only be undertaken, if at all, by the legislature.


A. Problems with “Market Share” Liability

Authorities in the field of products liability disagree as to the long-term impact of the Sindell ruling; however, it is generally agreed that the decision, although limited, poses potential procedural problems.

The first apparent problem with the “market share” approach is that all potential defendants need not be named. Only a “substantial share” or percentage of the total possible defendants must be named. This not only raises the practical problem of determining what a “substantial share” of the market is, but also leaves the possibility that the actual tortious manufacturer would not be named. In this situation, the “substantial share” of manufacturers, rather than the responsible tortfeasor, would pay for the plaintiffs injuries.

Although the Sindell court did not believe that this would be a major problem, its failure to give a guideline for determining what is a “substantial share” of a market has created potential problems. The lack of foresight by the court in creating a novel theory of liability without following up on the practical application of the theory has, perhaps unnecessarily, exposed the decision to criticism. A related problem is the failure of the court to explain a method of determining the “market share” of a defendant.

One potential procedural problem not discussed by either the majority or the dissent is whether a finding of “market share” liability may collaterally estop an entire industry from denying liability. Collateral estoppel has recently been ruled a proper pleading vehicle in products liability cases. However, these decisions do not address the possibility of collaterally estopping manufacturers of a generic product who have not personally had their day in court. In view of the generic quality of DES, as well as the limited scope of “market share” applicability, it is doubtful that this issue presents a serious problem.

Apart from the aforementioned procedural problems in Sindell, there are equitable drawbacks inherent in the “market share” theory. One of the most serious of these appears to be the problem with the apportionment of damages. For example, in cases where the plaintiff cannot name the responsible defendant, such as was the situation in Sindell, “market share” liability will be evoked. However, in those cases where the plaintiff is able to name the responsible manufacturer that caused her injuries, it is assumed that the plaintiff will retain the burden of proof as to the single defendant, rather than naming several defendants and proceeding under a “market share” theory For example, in case 1, if the plaintiff is able to identify a specific responsible manufacturer, the plaintiff will retain the burden of proof, with the single defendant paying 100 percent of the judgment. However, in case 2, if the plaintiff is unable to name the responsible manufacturer, she will name several and proceed on the basis of “market share” liability. If one manufacturer is named in both case 1 and case 2, that manufacturer-defendant will be forced to pay 100 percent of one judgment and a market share percentage in another. Thus, this combined liability will force that one manufacturer-defendant to bear a much greater burden than its actual market share.

As pointed out by the dissent, the above example would particularly become a problem if jurisdictions other than California fail to adopt the “market share” theory as advanced by the Sindell court. In this situation, those manufacturers more amenable to suit in California would be held to a disproportionate share of damages.

The final major problem with the “market share” theory is the concern that the pharmaceutical industry may be undermined by, in effect, making it the insurer of all defective drugs of uncertain origin.  Critics of the Sindell decision believe, as was stated in the dissent, that the theory will inhibit the dissemination of drugs, which is contrary to the public policy considerations advanced in the Restatement. A close look at the wording of the Restatement cited by the dissent, however, will show that these policy considerations do not apply to the facts of the Sindell case.

The Restatement states that public policy justifies the use of new or experimental drugs, despite medically recognizable risks, and that the manufacturer of such a drug will not be held strictly liable for subsequent injuries caused by the drug. However, this applies to manufacturers who are held strictly liable, and only applies when the drug is properly prepared and marketed, and proper warning given.  In contrast, Sindell sued the various respondents for their negligence in failing to properly market, test, and warn of the inherent dangers in the use of DES.

Therefore, it appears that the Sindell court, rather than holding the drug industry liable for all injuries that occur as a result of a drug previously thought to be safe, has only suggested that those manufacturers who are shown to have been negligent in their marketing or testing of a drug should be held liable for the consequences of their negligent acts. Rather than discouraging the dissemination of modern drugs, this policy should serve to encourage their safe testing, marketing, and utilization.

B. Benefits of “Market Share” Liability

The major advantage of “market share” liability is the equitable policy repeated throughout the Sindell decision. It is “preferable to hold liable a negligent defendant who did not in fact cause the injury than to deny an innocent plaintiff a remedy when it cannot be determined which of the defendants is responsible for the harm but it appears that one of them was.” This same general policy is the basis for virtually all of the major advances in the field of products liability in recent years.

Sindell was innocent of any wrongdoing, yet suffered serious injury. Although she could not name the manufacturer that produced the DES that caused her specific injury, she named several manufacturers, and alleged that all of them negligently produced the carcinogenic drug. If the Sindell court had not allowed the appellant to maintain her action, the result would have been that the victims of DES would have borne the cost of their injuries while the tortious manufacturers would have avoided liability. As has been stated so often by the courts, the cost of these injuries is much better borne by the manufacturers, who have the potential to guard against such dangers, than by the innocent victims of their mistakes.

C. The Potential Application of “Market Share”

It is clear that California’s “market share” apportionment theory is affecting almost immediately other DES cases pending in other courts. For example, in May of 1980, only one month after the Sindell ruling, a Cleveland woman settled out of court with four separate DES manufacturers for a total of two million dollars. This immediate result is not unexpected. After the Sindell decision,  one defense attorney involved in DES litigation stated that “the Sindell case is a major victory for the plaintiffs’ bar. Especially since California traditionally is in the vanguard of tort litigation, Sindell might represent a watershed in terms of a trend for the future. This seems to be the general consensus among both plaintiff and defense attorneys,  especially since the United States Supreme Court has denied the writ of certiorari sought by the Sindell respondents.

If, as is expected, the Sindell decision sparks a rash of suits based on “market share” liability, it may be advantageous for the drug companies to unite, develop a proportional scheme based on the market, and begin to organize efficient and expeditious settlements with DES plaintiffs.  Although this type of organization would be enormously expensive and administratively complicated, it would be beneficial to all parties in the long run. A plaintiff would be compensated sooner, and although she would possibly receive a lesser amount of recovery, the legal entangelments of lengthy litigation would be avoided. The defendants, although forced to pay damages in all cases, would save tremendous litigation expenses. This will especially be true if other jurisdictions follow the lead of Sindell, since without the necessity of the plaintiff identifying a specific defendant, defense verdicts would be rare. Finally, the advantage of mass settlement and avoidance of unnecessary and protracted litigation would be beneficial in promoting judicial efficiency by helping to alleviate the existing court backlogs around the country.

In regard to the further application of Sindell to other areas of tort litigation, the repercussions will be necessarily minimal because of the relatively few types of products liability cases that involve serious problems of defendant identification. The Sindell court limited itself in its application of “market share” liability to only cases where a plaintiff has an identification problem due to the generic quality of the product causing the injury. The court further limited the theory by applying it, as an element of causation, only in those cases where the manufacturer is negligent. Thus, the far-reaching impact feared by the critics of Sindell is unlikely to occur.

However, in those few cases that involve the type of identification problems found in DES cases, the application of the “market share” theory will be almost immediate. The most obvious of these cases are the more than 6,000 asbestos cases that are pending around the country.  The asbestos cases involve the factually analogous problem of a construction worker attempting to prove not only the identity of each of his employers during the twenty to thirty years of asbestos exposure, but also which manufacturer produced the asbestos products that were purchased by or on behalf of those employers over such period of time. This identity problem, similar to the DES cases, would without a “market share” type of approach preclude any remedy.  Like DES cases, asbestos litigation is similarly causing court backlogs throughout the country. Therefore, the judicial system, faced with such a problem, may welcome expeditious approaches to the resolution of these cases as well.


It is clear that Sindell is a substantial expansion of products liability law. It is equally clear that this expansion is necessary to meet the changing needs of society. It has been said that the life of the law is a response to human needs. The Sindell court, in developing the “market share” theory of liability, has expanded the law to adapt to the expansion of technology and industry in today’s advancing society.

Far from stifling the drug industry, the “market share” theory should encourage more responsible testing and care in the development of modern drugs. The Sindell decision does not call for the pharmaceutical industry’s guarantee of fool-proof drugs, rather, it calls for a responsible attitude in their development.

This decision also avails the courts of an expeditious approach to relieve court backlogs in cases where the liability is clear but proof of causation as to a specific manufacturer is not. This decision should be a welcome answer to a practical problem felt by many members of the legal profession in eliminating expensive, time-consuming, and unnecessary litigation.

In conclusion, although some problems exist in the “market share” theory of liability the benefits to be gained from its adoption greatly outweigh any disadvantages. The inequities in the decision are limited to those manufacturers responsible of innocent plaintiffs.

N. Denise Taylor, 1981.

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