The 2025 Consumer Electronics Show (CES) — one of the world’s most influential tech events — once again showcased groundbreaking innovations that are shaping the future of technology. I was among the over 141,000 attendees of CES 2025 who witnessed the unveiling of revolutionary advancements in artificial intelligence, autonomous vehicles and watercrafts, smart home devices, wearable health tech and more.
While these innovations are thrilling, they also present new challenges for product and software manufacturers and suppliers. Consumers no longer just hope for technology advancements, they expect them. Companies are under constant pressure to create the next big thing and deliver cutting-edge products. But with great innovation comes great responsibility. Indeed, software glitches, hardware failures and unexpected safety risks can quickly turn into legal liabilities.
So, how can manufacturers stay ahead of the curve while mitigating their risk of liability?
- Test Like Your Business Depends on it (Because it Does): Thorough product testing isn’t just a box to check during the production part approval process (PPAP) — it’s your first line of defense against product liability claims. Real-world testing under different conditions helps detect potential issues before your product reaches consumers. The more unpredictable the technology, the more critical the testing.
- Make Product Instructions and Warnings Crystal Clear: Many product injuries arise not because a product was defective, but because users didn’t understand how to use it properly or were not aware of potential risks. Clear, user-friendly instructions, safety warnings and even digital guidance (like in-app tutorials) can reduce misuse and mitigate liability.
- Keep Up with Changing Regulations: The laws surrounding AI, autonomous vehicles, health tech, etc. are evolving fast. A product that is legally compliant today may be outdated tomorrow. Staying informed and working closely with legal counsel ensures you are always ahead of potential regulatory issues.
- Strengthen Your Supply Contracts, Indemnity Agreements and Warranties: When developing cutting-edge products or components, do not simply default to old contract terms or warranties. Supply agreements should be tailored to account for the unique challenges and risks of high-tech manufacturing and to ensure any liability is properly allocated. Likewise, ensure that all applicable product warranties clearly outline coverage limits, exclusions and responsibilities of the consumer.
- Prepare for the Worst (Have a Recall Plan): Even strongly engineered products can run into unforeseen issues. A well-prepared recall strategy can mean the difference between a manageable situation and a full-blown PR and legal crisis. Fast, transparent action can protect both consumers and your company’s reputation.
- Understand That Cybersecurity is Not Optional: Many of today’s products connect to the internet, making them prime targets for security breaches. A product that gets hacked or leaks sensitive data can lead to costly lawsuits and regulatory headaches. Strong encryption, regular updates and compliance with data protection laws are essential.
Innovation and risk go hand in hand, but manufacturers do not have to choose between the two. You can be a successful innovator if you also engage in smart risk management. By prioritizing robust testing, clear communication, strict regulatory compliance, strategic contracting and cybersecurity, companies can stay ahead of the curve while also mitigating the risk of liability.
