When Less Liability May Mean More Precaution: The Case of Nanotechnology

I. INTRODUCTION II. FRAMING THE NANOTECHNOLOGY PROBLEM A. The Information Deficit B. Three Components of a Precautionary-Study Approach to Nanotechnology 1. Mandatory Testing and Monitoring Requirements 2. Public Funding 3. Voluntary Testing III. MODELING MANUFACTURER DECISIONMAKING A. Assumptions B. Variables 1. Damages (D) and Standard of Liability (S) 2. Probability of Detection/Attribution (P) and Research Costs (R) C. Comparing the Expected Costs of the Four Options 1. Period One, Pre-Market Investment 2. Period Two, Post-Market Investment 3. Combining Pre-Market and Post-Market Research 4. Comparing the Research Options D. Decreasing the Likelihood of Liability-Driven Avoidance of Post-Market Testing 1. Which Products Will Be the Subject of Voluntary Testing 2. Products Containing Identical or Substantially Identical Materials or Technology 3. Producers of Products Containing the Same General Category of Potentially Risky Materials or Technology IV. FDA PREEMPTION As A MODEL FOR FASHIONING A VOLUNTARY-TESTING-FOR-LIABILITY-RELIEF REGIME FOR NANOTECHNOLOGY A. Genuine Statutory (Rather Than Agency) Preemption B. Preemption Limited to Torts Based on Failures to Test or Monitor C. Government Oversight and Transparency D. Subsidized Insurance as an Alternative Liability-Relief Mechanism E. Features Unique to a Voluntary Regime V. CONCLUSION: NANOTECHNOLOGY AND BEYOND I. INTRODUCTION Ignorance may be bliss, but it is generally bad policy. This may be especially true with respect to existing and forthcoming products that embody the relatively new, still poorly understood technology called "nanotechnology." Nanotechnology products offer the promise of highly beneficial uses, but also pose uncertain risks of adverse health and environmental effects. For products embodying nanotechnology, there is a powerful normative case for adherence to what I call "the precautionary-study principle." The principle requires that the possible risks from these products be explored before their release to the marketplace. It also would require that possible risks are thereafter continually studied. Continual study after the release of products into the market is important because it allows adverse effects to be isolated and understood using improvements in the background science and real-world observations and reports from consumers and others who have been exposed to the products. A central question, therefore, is how to shift the nanotechnology status quo toward greater adherence to a precautionary-study principle. To that end, this Article proposes a federal legislative regime of limited protections from tort liability for nanotechnology product manufacturers who engage in pre market and post-market research and monitoring regarding possible adverse health and environmental effects from their products. The central argument is that less liability may mean more precaution, and, hence, is a good thing. Nanotechnology is generally defined as technology that incorporates nanomaterials--engineered, extremely small materials that can be as small as 1/80,000th the width of a human hair. (1) Nanomaterials currently used in products employ common organic elements such as gold, silver, titanium, and carbon, but nanomaterials function very differently than larger materials made up of these same elements. Because of their distinctive size-related functional attributes, nanomaterials may be very useful in areas ranging from cancer treatment to smoothing wrinkles. But the size-related attributes of these materials may translate into significant health risks. …