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The Depreciation-Based Injury Theory: Shaping Products Liability Litigation

Picture this: You just saved up for your favorite smartphone and finally picked it up from the store. But soon after, you discover a significant battery flaw that considerably curtails its expected life span. Although no data loss or accidents have occurred, the device’s worth has taken a plunge. This is where the depreciation-based injury theory comes into the picture, a legal doctrine specifically designed for such scenarios. Join us today as we unravel this legal principle’s nuances and intricate details.

Understanding Product Liability

In US law, product liability refers to the legal mandate of any manufacturer, retailer, or distributor to compensate for any damage or injuries because of a defective product they have produced or sold.

There are three forms of product liability, as outlined below:

  • Manufacturing defects- a product that has manufacturing flaws
  • Design defects- flaws in the product’s design that make it unsafe or defective
  • Warning or marketing defects- inaccurate instructions, labeling, or warnings that can lead to a consumer’s misuse or lack of understanding of the product

“While product distribution laws vary from jurisdiction to jurisdiction, the general consensus is that they help you seek compensation for injuries, damages, or loss because of a defective product,” says Attorney Robert Hammers of Hammers Law Firm

The Essence of Depreciation-Based Injury Theory

Over the years, the plaintiff’s bar has gradually adopted the depreciation-based injury theory in product liability cases. Under this legal doctrine, if the plaintiff purchases a product only for it to depreciate because of flaws, they have suffered an injury sufficient to sue.

Typical example:

If you buy a car with a design flaw that causes the car to depreciate, you might use the depreciation-based theory in court to argue that you deserve compensation for this loss. Worth noting is the absence of physical injury, where the plaintiff claims the defect has caused financial damage.

Legal Standing and Depreciation-Based Injury Theory

Unbeknownst to most people, the depreciation-based theory can help plaintiffs bring a legal standing in a product liability case. Using this legal doctrine, plaintiffs can effectively show the court they suffered financial loss because of the product’s defect, even if there is no tangible harm.

Over the years, this principle has steadily gained traction in the legal sphere because it broadens product liability litigation and can hold manufacturers, retailers, and distributors more accountable for product quality.

Recent Cases and Their Outcomes

Plaintiffs have successfully implemented the Depreciation-Based Injury Theory in a few documented cases. We list a few of them below:

Victor v. R.C. Bigelow, Inc., 2014:

The plaintiff argued they paid for premium products that falsely claimed to offer nutritional and health benefits. The court concluded the plaintiff had grounds to sue since they paid a premium price for a product that did not have the advertised features.

In re Clorox Consumer Litigation, 2013:

Here, the plaintiff argued they paid a premium price for extra performance features that the product did not have. The court found the plaintiff had grounds to sue since they had suffered financial damage by paying for these extra features.

Morgan v. Wallaby Yogurt Co., Inc., 2013:

The plaintiff argued they paid more for a product that contained inferior-quality ingredients. The court concluded the plaintiff had standing to sue since they paid a premium price for a product with undesirable ingredients.

The cases above are a perfect embodiment of the depreciation-based theory, and they show how plaintiffs can use this doctrine to seek compensation in product liability cases, even in the absence of physical harm.


We hope this blog has been informative in broadening your understanding of the depreciation-based theory. With this information at hand, you can seek compensation for financial loss because of defective products.

When filing such lawsuits, engage legal professionals, as they can help you navigate the often complicated intricacies of product liability lawsuits and increase your chances of winning.

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