The Product Liability and Mass Tort Monitor is a monthly newsletter delivering critical updates, data insights and actionable strategies for navigating the complexities of product liability and mass tort litigation. This month’s issue explores the U.S. Court of Appeals for the Third Circuit’s recent decision in Coates v. Ford Motor Co., which clarifies the limits of the “malfunction theory” of product defect when the allegedly defective product remains available for inspection.
Key Takeaways
- The Third Circuit held in Coates v. Ford Motor Co. that a plaintiff may not invoke the malfunction theory embodied in Section 3 of the Restatement (Third) of Torts: Products Liability in which the allegedly defective product was not lost or destroyed but remained available for inspection.
- Even assuming the malfunction theory applied, the court held that the plaintiff’s evidence was too speculative to show that any unspecified defect existed when the vehicle left the manufacturer’s control, given 14 years of use, more than 93,000 miles, three owners, and multiple accidents and repairs.
Product liability plaintiffs who cannot identify a specific defect often turn to the “malfunction theory,” a res ipsa loquitur-style doctrine that permits a jury to infer a defect from circumstantial evidence. But in Coates v. Ford Motor Co., No. 25-1808, decided Aug. 31, 2026, the Third Circuit held that the doctrine’s more lenient evidentiary standard is unavailable when the allegedly defective product is not lost or destroyed but remains available to the plaintiff for inspection.
Background
Millentine Coates was injured in a single-vehicle accident while driving her 2002 Ford Explorer on a highway in St. Thomas, U.S. Virgin Islands, in September 2016. She alleged that the vehicle’s airbags spontaneously deployed, causing her to lose control and crash into a hillside. She sued Ford on a product liability claim but did not identify any specific defect in the vehicle’s restraint control module (RCM), the “brains” of the restraint system that senses crashes, deploys airbags and records crash data. Instead, she relied on the malfunction theory, pointing to her own testimony and to the RCM’s unexplained failure to record a crash or deployment event.
The record showed that the vehicle and its RCM remained available. The parties’ experts jointly inspected the vehicle and downloaded the RCM data. Coates’ expert recommended an internal RCM teardown and testing of the frontal accelerometer sensor, but neither was performed. The vehicle also had a long and complicated history: three owners, more than 93,000 miles, a 2003 accident with front-end damage and an engine replacement, 2004 electrical wiring repairs, a 2015 collision, and a replaced driver’s seat whose seatbelt pretensioners were never reconnected.
The District Court of the Virgin Islands granted summary judgment to Ford. Assuming without deciding that Section 3 applied, the court held that Coates failed to create a genuine dispute of material fact as to whether the alleged defect existed at the time of sale, whether it was the most likely cause of the deployment, and whether it proximately caused her injuries.
The Third Circuit’s Decision
Writing for a panel that included Judges Thomas Hardiman and Stephanos Bibas, Judge David Porter first predicted that the Supreme Court of the Virgin Islands would adopt Section 3. The court then affirmed on two independent grounds.
1. Malfunction Theory Does Not Apply When Product Is Available
As the court explained, the malfunction theory, like res ipsa loquitur, seeks to help a plaintiff who lacks access to direct evidence of a defect through no fault of her own, most commonly because the product was destroyed, lost or discarded. Two considerations counseled against extending it further. First, the doctrine is already “plenty potent”: Unlike res ipsa loquitur, it permits two inferences (that a defect caused the incident and that the defect existed when the product left the manufacturer’s control), even though the product has left the defendant’s control. Second, applying the doctrine when the product is available ignores its underlying rationale.
The court rejected Coates’ argument that the RCM’s failure to record data was the “functional equivalent of destruction,” finding that she stated the principle “at too high a level of generality.” Although the RCM data was missing, the RCM itself, the rest of the airbag system and the vehicle remained available, and Coates declined to pursue further inspections recommended by her own expert. As the court put it, “a plaintiff should not look to the malfunction theory to bridge an evidentiary gap that she may well have been able to fill had she diligently inspected the allegedly defective product.” Joining the courts that have closely considered the question, the Third Circuit predicted that the Supreme Court of the Virgin Islands would decline to apply Section 3 when the product was available for inspection.
2. Prolonged Use Defeats Inference of Defect at Time of Sale
Even if Section 3 applied, the court held that Coates’ evidence could not lift her claim “out of the realm of speculation.” Section 3 requires proof that the incident was not solely the result of causes other than a defect existing at the time of sale, and courts weigh factors such as the product’s age, alteration by repairers and misuse. The court found that 14 years of use over more than 93,000 miles, an attenuated chain of custody, and multiple accidents, repairs and modifications “severely undermine[d]” any inference that a defect existed when Ford sold the vehicle in 2002. The court also observed that evidence that the vehicle performed without problems for years “cuts against” rather than supports such an inference. Surveying the case law, the court found no case in which an unspecified-defect claim survived summary judgment on comparable facts.
Implications
Coates is a significant decision for manufacturers defending claims premised on an unidentified defect. It confirms that the malfunction theory is a narrow evidentiary rule, not a substitute for proof of a specific defect when the product can be examined. Defendants should evaluate early whether the product and its components remain available and whether the plaintiff has exhausted reasonable avenues of inspection and testing, and should develop the record on a product’s age, ownership history, repairs and modifications. Courts within the Third Circuit and beyond may look to Coates as persuasive authority on whether the doctrine applies to available products, a question on which courts have been divided.
For more information on these issues, contact the authors or a member of McGuireWoods’ Product Liability & Mass Tort Practice Group.