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Legal Memorandum: Solely Economic Losses in Tort

Issue: May a plaintiff base a tort claim solely on economic losses?

Area of Law: Personal Injury & Negligence
Keywords: Solely economic losses; A tort claim
Jurisdiction: California, Michigan, New Jersey
Cited Cases: 182 N.W.2d 800
Cited Statutes: None
Date: 12/01/2006

  Although “[a]s a general rule, solely economic losses are not recoverable in tort,” LeBlanc Nutritions, Inc. v. Advanced Nutra LLC, No. Civ. S-05-0581FCDJFM (E.D. Cal. June 14, 2005), there are “numerous [exceptions] to this general rule,” such as when privity is lacking and the risk of harm was foreseeable, id. See Cova v. Harley Davidson Motor Co., 182 N.W.2d 800, 804 (Mich. Ct. App. 1970) (referencing established New Jersey law, and holding that a consumer should be allowed to sue in tort a manufacturer for economic loss caused by a product defect).  On principle, there is no reason why a consumer should be allowed to sue the manufacturer that has caused a personal injury, but barred from suing the same manufacturer for the same defective product that causes only economic loss.  Id. at 804.

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