Today we now have a visitor publish on some latest developments on whether or not strict legal responsibility applies to software program, apps, synthetic intelligence, and different types of digital information, which relies upon, as this 50-state survey addresses, on whether or not such intangible objects meet the widespread-regulation definition of “product.” It is by Reed Smith attorneys (and repeat visitor posters) Mildred Segura and Jamie Lanphear. As all the time, our visitor posters ought to obtain 100% of the credit score (and any blame) for what they’ve written.
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Those of us who grew up watching The Jetsons keep in mind fantasizing a couple of future full of flying vehicles and robotic housekeepers like Rosey (later spelled Rosie), who dealt with all the things from vacuuming to snarky commentary. While the flying vehicles haven’t arrived—but—our current-day product legal responsibility protection lawyer selves are equally captivated by the proliferation of AI, significantly within the life sciences sector.
AI’s increasing position throughout diagnostics, epidemiology, drug discovery, medical trial administration, customized medication, and healthcare operations has established it as a essential instrument for advancing affected person care, accelerating analysis, and optimizing enterprise processes throughout the life sciences sector. But with innovation comes threat—and the authorized panorama is evolving to handle these new developments. One of the trickiest challenges is that AI doesn’t match neatly into current authorized frameworks. Product legal responsibility regulation, for instance, has historically handled bodily merchandise. For many years, the prevailing view has been that software program just isn’t a “product.” With the proliferation of cellular apps, social media, and AI-enabled instruments, nevertheless, that consensus is shifting.
Courts Are Redrawing the Line
Recent choices present that courts are more and more keen to entertain product legal responsibility claims in opposition to software program-based mostly programs—both in complete or partly—beneath a couple of totally different theories. Here are three (non-unique) approaches we’re seeing:
- Function-by-Function: The “Defect-Specific” Approach
The Northern District of California was the primary to articulate the “defect-particular” method within the In re Social Media Adolescent Addiction Personal Injury/Products Liability Litigation MDL. Plaintiffs—primarily mother and father suing on behalf of minors—allege that a number of social media platforms had been deliberately designed to be addictive, resulting in harms akin to psychological well being points and the sexual exploitation of minors. A key authorized battle was whether or not these platforms needs to be thought-about “merchandise” beneath conventional product legal responsibility regulation. Historically, courts have handled software program as a service, not a product, shielding builders from product legal responsibility claims. And that was the argument made by the defendants of their movement to dismiss. The courtroom, nevertheless, rejected this “all or nothing” method. 702 F. Supp. 3d 809 (N.D. Cal. 2023). Instead, the courtroom examined the precise capabilities alleged to be faulty, evaluating whether or not every might be analogized to tangible private property. For each single perform it analyzed, the courtroom concluded that there was some tangible property analogous to it and allowed the plaintiffs’ design defect claims to proceed. We have beforehand reported on this choice right here and right here.
The “defect-particular” method has since influenced different rulings. In In re Uber Technologies, for instance, the courtroom utilized an identical framework to guage security options in a rideshare app, discovering some sufficiently “product-like” to permit strict legal responsibility claims to proceed. 745 F. Supp. 3d 869 (N.D. Cal. 2024). In newer instances—like AF v. Character Techs. and Doe v. Roblox—plaintiffs look like borrowing this playbook by focusing their product legal responsibility claims on the design and operation of particular software program options, fairly than the platform as a complete.
- App-as-Product: The Platform-as-a-Whole View
Some courts have taken a broader view, evaluating whether or not the app or platform as a complete is analogous to tangible private property. In T.V. v. Grindr, the Middle District of Florida took this place to conclude on the movement to dismiss stage {that a} relationship app was a product topic to strict legal responsibility. 2024 U.S. Dist. LEXIS 143777 (M.D. Fla. Aug. 13, 2024). The courtroom thought-about how the app was designed, mass-marketed, and monetized, emphasizing that whereas the Restatement (Third) of Torts usually defines “product” as tangible private property, the definition additionally contains intangibles when their distribution and use are sufficiently analogous to the distribution and use of tangible items. The courtroom highlighted the necessity for widespread regulation to maintain tempo with technological change and underscored the coverage behind strict legal responsibility: inserting the price of harm on the get together finest capable of stop it. Mass-marketing and distributing the app for revenue was sufficient, within the courtroom’s view, to make it a product beneath tort regulation.
- Drawing a Line Between Design and Content
A 3rd method—typically invoked in response to arguments beneath Section 230 of the Communications Decency Act (CDA)—distinguishes between content material and the medium by which content material is delivered. In Garcia v. Character Technologies, a case involving claims in opposition to a generative AI chatbot, the courtroom differentiated between the chatbot’s expressive outputs (not actionable beneath product legal responsibility) and its designfeatures, akin to insufficient age verification, which had been actionable. Claims based mostly on “content material” had been dismissed; claims based mostly on “design” weren’t. This ruling bolstered a essential and more and more litigated boundary: product legal responsibility applies to how a digital instrument is constructed—not what it says.
Continuing the Trend: Nazario v. ByteDance Ltd. because the Most Recent Example
The newest instance comes from New York. In Nazario v. ByteDance Ltd. (June 2025), the courtroom declined to dismiss product legal responsibility and negligence claims in opposition to a number of social media platforms. The plaintiff alleged that algorithms had focused a minor with dangerous content material. In its evaluation, the courtroom drew a transparent distinction between passive content material supply—which is usually protected by Section 230—and the usage of focused suggestion engines that leverage demographic and behavioral information.
That distinction proved vital. The courtroom decided that, if confirmed, the platform’s concentrating on practices may represent a design defect in a product, fairly than mere editorial judgment. As a outcome, Section 230 didn’t categorically bar these claims, since they had been framed across the design and perform of the algorithms, not their content material. This choice reinforces the rising pattern of courts treating software program and AI as merchandise—at the very least on the movement to dismiss stage. Courts have but to handle the difficulty on the abstract judgment stage, so it stays to be seen how they are going to rule as soon as they get pleasure from a full factual document developed by discovery.
A New Wrinkle from Ohio: Deditch v. Uber Technologies, Inc.
A latest growth in an Ohio case, Deditch v. Uber Technologies, Inc., 2025 WL 1928937 (N.D. Ohio July 14, 2025), provides a brand new wrinkle to this evolving space. There, a journey-sharing firm moved to dismiss a negligence declare involving its app by arguing that the Ohio Product Liability Act (OPLA) abrogates all widespread regulation product legal responsibility claims—together with these based mostly on the alleged negligent design of its app. What’s inquisitive about this technique is that the defendant concurrently agreed “that its app just isn’t a product” beneath OPLA’s definition. Id. at *2. That raised a novel challenge of whether or not OPLA’s broad abrogation of widespread-regulation product legal responsibility prolonged to litigation not involving statutory “merchandise.” Id. at *3. The courtroom thus licensed the query of whether or not claims involving digital apps fall throughout the Act’s scope to the Ohio Supreme Court. This case is one to look at, because the Ohio Supreme Court’s reply may set an vital precedent for the way software program is handled beneath state product legal responsibility statutes.
Meanwhile, within the EU…
Across the Atlantic, lawmakers in international locations with out the Anglo-American widespread regulation custom should not ready for the courts. The EU just lately adopted a brand new Product Liability Directive that explicitly defines software program and AI as “merchandise”—even when delivered as a service. While that shift doesn’t bind U.S. courts, it does add worldwide momentum to an already-evolving idea. For international corporations, the implications are laborious to disregard.
So, Is Software Now a Product?
Not all the time. Not in all places. But it’s getting more durable to say no. Courts are exhibiting a rising willingness to interrogate how software program works—and, in some instances, to deal with it just like the very issues tort regulation was designed to handle: merchandise.
As software program more and more serves because the bridge between human choice-making and tangible, actual-world outcomes, the normal distinction between a service and a product could also be breaking down.
We are witnessing this boundary shift in actual time. Software, step-by-step, could also be transferring from one aspect of the road to the opposite.