Posted February 17, 2017

Congressman Farenthold introduces Innocent Sellers Fairness Act

Bill would protect dealers from unfair and unfounded lawsuits.

The National Lumber and Building Material Dealers Association (NLBMDA) applauds the reintroduction yesterday in the House of Representatives of the Innocent Sellers Fairness Act (H.R. 1118). Sponsored by Rep. Blake Farenthold (R-TX), the legislation provides product liability protection in certain circumstances for wholesalers and retailers - such as lumber dealers - that merely sell products, and do not manufacture or alter them. Reps. Jimmy Duncan (R-TN) and Lamar Smith (R-TX) are original cosponsors of the bill.

Unfair and unfounded lawsuits disproportionately affect small business. According to a study by the U.S. Chamber of Commerce Institute for Legal Reform, small businesses bear 81 percent of business tort liability costs. The legislation addresses this problem faced by lumber dealers. While state reforms have helped, a federal solution is important to ensure uniformity for suppliers who often operate in multiple states.

"NLBMDA continues to lead the charge on Capitol Hill in addressing the burden product liability lawsuits have on businesses, and thanks Congressman Farenthold for his leadership on this issue," said NLBMDA President and CEO Jonathan Paine. "Dealers should not be forced to fight a product liability lawsuit, or worse agree to a settlement, when the failure or damage was caused without their knowledge or control."

Current law can result in liability without wrongdoing on sellers, and exposes them to all of the damages allegedly suffered by a plaintiff, even though others may have played the critical role in causing the damages. The fault may have been in the manufacture, installation and design of the product, or in a customer's improper use of the product, yet dealers are often faced with some or all of the liability.

NLBMDA urges dealers from across the country to visit NLBMDA's Legislative Action Center to contact their representative and ask them to cosponsor on the Innocent Sellers Fairness Act.