Nadler: New and improved Safety Act

The foiling of a terrorist plot in August to blow up planes that were headed to the United States and the five-year anniversary of the terrorist attacks on the World Trade Center and the Pentagon have focused renewed attention on the crucial role of technology in protecting the United States.

After the 2001 terrorist attacks, the government moved aggressively to stimulate innovation and encourage the private sector to develop cutting-edge technologies to aid in the war on terrorism.

One of the biggest challenges the government faced was companies’ fears of tort liability in the case of a terrorist attack. Businesses were afraid of being sued out of existence amid claims that their anti-terrorist technology failed to thwart an attack.

Lawmakers created the Support Anti-Terrorism by Fostering Effective Technologies (Safety) Act of 2002 to promote the effective use of technologies that federal, state and local governments and commercial entities can use to guard against terrorist attacks.

The act provides significant product liability protection to the recipient of a Safety Act designation, its customers and subcontractors. It authorizes the secretary of the Homeland Security Department to designate qualified anti-terrorism technologies to receive certain protections.

It also establishes a litigation management framework for claims arising from a terrorist act when qualified technologies have been deployed. The Safety Act limits the legal action that people can take when they believe the failure of those technologies caused their injuries.

The act provides for a statutory “government contractor defense” for technologies that are certified by DHS after a higher level of examination. This is a common law defense to tort liability claims that the Supreme Court established in a 1988 case, Boyle v. United Technologies Corp., which protects manufacturers from design-defect lawsuits when the government approved those designs. The act creates a rebuttable presumption that the government contractor defense applies to qualified technologies.

A variety of technologies received Safety Act protection, but industry officials complained that the application process was slow and unnecessarily burdensome, which kept some companies from getting Safety Act designations.

In response, DHS has issued a streamlined application kit that clarifies the information that companies must provide before DHS reviews a particular technology. The new kit includes expedited procedures and a simplified pre-application process to let companies know whether the technology is likely to be approved. It also allows companies to wait for an initial evaluation before providing detailed Safety data.

The Safety Act is an important tool for the government to access new technologies by providing liability limitations and other incentives for contractors that develop and sell those technologies.

Time will tell whether the new kit will improve the Safety Act application process and help stimulate a greater number and variety of anti-terrorism technologies to protect the country. There are still some gaps in the new kit, such as the lack of a clearly defined time frame for an expedited application. However, the new kit is a useful response to industry’s concerns and a step forward in the war on terrorism.

Nadler is a partner in the law firm of Dickstein Shapiro. Contact him at nadlerd@dicksteinshapiro.com.