Torts v. Technology: Accommodating Disruptive Innovation
James A. Henderson, Jr. Given that the American legal system supports markets that make technological advancement economically feasible and thus attractive to investors, it may be said that our law generally encourages the development of innovative, albeit sometimes unavoidably dangerous, technology. Specific examples abound. Thus, the rule of limited shareholder liability encourages innovative risk-taking. And some specialized areas appear even more self- consciously to promote innovation; in this regard, intellectual property law deserves high marks for making the effort, whatever may be said for its bottom-line results. By contrast tort law, whether or not its central objective is deterrence, carries the potential for discouraging creative technological innovation. Indeed, observers have criticized the American system of products liability on precisely that basis and have argued that it contributes significantly to placing…