Loko Liability: Claims Against Alcohol Beverage Manufacturer for Intoxication Injuries
By Ashley Vulin, Cary Greene, Chip English and Dave Ernst
Recently, the parents of a young man who died of alcohol poisoning filed a wrongful death suit against Phusion Projects, Inc., the company behind the “Four Loko” Beverage. This type of lawsuit against the manufacturer of an alcohol beverage is uncommon. Dram shop laws facilitate lawsuits against retailers for over-serving someone who subsequently causes a drunk- driving accident, but courts typically have not found a manufacturer liable for harms to the consumer caused by his own over-consumption. However, Four Loko has seen its fair share of this kind of litigation (see an overview of them in this insurance coverage lawsuit).
Four Loko was an innovative product, combining caffeine and malt liquor into a single beverage. While initially very popular, the drink came under attack after a string of incidents in 2011. In Washington, nine college students were hospitalized after consuming Four Lokos at a party, leading the Attorney General to push for a national restriction on the sale of the product. In the face of this backlash against the product, the company removed caffeine from its formulation, and added additional labeling on the can under pressure from the FTC.'
This latest complaint makes allegations under the Washington Product Liability Act. The complaint parrots two of the major criticisms of the product. First, that the 23.5 ounce drink contained the alcohol equivalent of up to four or five beers, rather than the one or two advertised. Second, that the combination of alcohol and caffeine allegedly prevented the consumer from feeling the effects of the alcohol, leading him to drink more than he otherwise would have.
On a case-specific level, the plaintiff’s claims must overcome a few hurdles. First, claims of defective design require a plaintiff to show that the product was unsafe to an extent beyond what a normal customer would contemplate. A jury could be asked whether an ordinary consumer would likely anticipate that a malt liquor drink could get them drunk, even with the presence of caffeine. While the presence of caffeine does add an additional hook for potential liability, a court may be hard-pressed to overlook combinations of caffeine and alcohol so readily accepted in other situations; bars and restaurants have been serving "rum and Cokes" or Irish coffees for years without facing these sorts of claims.
Beyond the case-specific analysis, the case raises a number of public policy concerns that relate to the beverage industry as a whole. Imposing liability in this instance rejects the “individual responsibility” approach often favored in American society. The pushback from Big Brother-type restrictions on drinking is what led to the repeal of Prohibition and the 21st Amendment (notably, the only amendment actually repealing a prior amendment).
While this complaint is unique to the particular issues related to Four Loko, it is worth following as it pertains to the treatment of new alcohol beverage products. Many other products have been met with allegations of dangerousness when first introduced onto the market, including malt liquor, wine coolers, and flavored malt beverages. It will be interesting to see how Four Loko charts its path following this latest round of litigation.