We asked Horwich Farrelly for some thoughts on e-scooters and their associated risks, because as the better weather arrives in the UK the chances of accidents, thefts, vanadlism, damage to third party vehicles etc increases.
Daniel West, Partner and Head of Product Liability, offers these thoughts;
In contrast to the government’s approved trial rental schemes, private e-scooters remain illegal to use, but are a common sight on UK roads and pavements. Recent reports of a teenage girl who was riding an e-scooter and collided with a van resulting in her death, highlight the risks users face when adopting this new form of micromobility. And whilst collisions will no doubt make up a large part of the litigation associated with e-scooters, reports of e-scooter battery fires and other defects show the potential for emerging product liability litigation in this area.
Risk of fires
E-scooters run on lithium-ion batteries which are popular because they store a large amount of power in a small space. But they can catch fire, particularly if they sustain damage or if they aren’t charged correctly. And the fires produced can be difficult to extinguish, often requiring specialist equipment.
There have been several high-profile reports of e-scooter fires. For example, in October 2018, e-scooter company Lime recalled a number of its e-scooters due to a risk of the batteries “smoldering, or in some cases, catching fire”. In November 2021, an e-scooter fire at Parsons Green tube station prompted TfL to ban private e-scooters from the London’s transport network. Then on New Year’s Day, a Voi Scooters warehouse containing 200 e-scooters set on fire as a result of batteries overcharging or tangled extension cords.
It was reported in March that London firefighters had been called to more than 130 fires involving batteries in e-scooters and e-bikes in just over a year. (There were just 33 e-scooter fires in the UK in 2020 which suggests a very clear upward trend.)
Other product liability risks
Beyond fires, there are other manufacturing defects associated with e-scooters. For example, in November 2018, Lime recalled more of its e-scooters because they could break apart in use (Lime issues global recall of one of its electric scooter models amid fears that it can break apart in use – The Washington Post). Elsewhere, there have been reports of sticky throttles (causing uncontrolled acceleration), faulty brakes and detaching handlebars.
It’s also worth noting that e-scooters run on software, also be subject to faults, sometimes because of a software update. In February 2019, Lime (again) had to withdraw some its e-scooters from circulation because software glitches were causing the front wheels to lock up mid-ride, a problem which later had to be fixed via a software update (Lime Scooter Software Glitch Causes Random Braking, Dozens Of Rider Injuries (forbes.com)).
Another issues that can arise after the e-scooter is on the road relates to maintenance (or lack thereof) of e-scooter rental fleets. For instance, there have been reports of worn-away treads on e-scooter tires used in the Birmingham rental trial and there are mass tort lawsuits in the US against Lime and e-scooter company Bird relating to allegations of malfunctioning brakes, throttles and handlebars arising because of poor maintenance.
Product liability claims
If a fault in an e-scooter (whether that be a defective battery, mechanical issue or software glitch) causes someone in the UK to sustain an injury or property damage, then that person will likely be able to bring a product liability claim. For instance, they might bring a claim against the supplier of the e-scooter (for breach of contract) or against the manufacturer (under the Consumer Protection Act 1987).
Those dealing with such litigation may have to grapple with at least some of the following complex issues:
1. Whilst the fact a user may have been using the e-scooter illegally will probably not have an impact on liability (since there would still be an expectation that the e-scooter is safe), there have been reports of some users and mechanics modifying e-scooters to remove speed restrictions; and if an accident is caused by such a modification, then a defendant may escape liability.
2. That said, if an e-scooter manufacturer becomes aware (or ought to be aware) of a risk created by the misuse of its e-scooters (whether arising out of modifications or some other misuse, like aggressive riding or even incorrect charging) then it may be under a duty to take steps to address this risk, including (for example) by providing warnings or by redesigning the e-scooter.
3. The issue of software updates, which introduces changes to an e-scooters after it’s supplied, ties into a wider issue concerning modern, connected products and the fitness for purpose of traditional product liability laws. Questions have been raised including whether the safety of a product should only be assessed at the point it is placed on the market, whether there should in fact be obligations placed on the manufacturer to continually update products (to improve safety) and what impact a software update will have on limitation. Both the UK’s Office for Product Safety & Standards and the EU are reviewing such issues with a view to reforming product liability laws to address software, software updates and AI.
What this all means for insurers
The existing regime covering e-scooters (which combines legal rental schemes with private e-scooters which are legal to purchase but illegal to use in public) is far from satisfactory and will no doubt be subject to upheaval soon. It’s possible e-scooters will be banned outright but more likely they will be made legal on some modified basis.
If e-scooters are made legal then motor insurers will be mindful of the increase in claims arising from collisions involving e-scooters, but elsewhere property insurers and insurers of e-scooter companies will no doubt have already seen the results of an upward trend in e-scooter fires. And as insurers start to see more e-scooter product liability claims, including those involving mechanical and software defects, they may need to grapple with thorny issues involving, for example, modifications, foreseeable product misuse and the impact of software updates.
Insurers will want to keep a close eye both on the legal status of e-scooters and any reforms to product liability laws coming down the track.