BILL ANALYSIS Ó SENATE JUDICIARY COMMITTEE Senator Noreen Evans, Chair 2011-2012 Regular Session AB 2243 (Knight) As Amended May 7, 2012 Hearing Date: July 3, 2012 Fiscal: No Urgency: No ME/RD/TW SUBJECT Liability: Commercial Space Flight DESCRIPTION This bill would provide a limited civil immunity to space flight entities for injuries sustained by a space flight participant if the entities meet certain requirements, including warning the voluntary participant of the inherent risks of space flight and obtaining the participant's informed signed consent. This bill would not provide immunity for injuries proximately caused by a space flight entity that is grossly negligent, willfully or wantonly disregards the safety of the participant, intentionally causes injury, or has actual knowledge or reasonably should have known of a dangerous condition, as specified. BACKGROUND Space travel has fascinated the public since the first human space flight was launched in 1961. Since that time, various government space programs have been established and have launched astronauts in space. Now, space travel by private citizens is an emerging commercial industry in the United States. Indeed, in 2004, the first private human space flight occurred in Mojave, California. That same year, Congress passed the Commercial Space Launch Amendments Act of 2004 (CSLAA). The CSLAA created a licensing and regulatory scheme to promote the development of the commercial space flight industry. However, the CSLAA does not address liability issues that arise when voluntary participants in commercial space flight are injured or (more) AB 2243 (Knight) Page 2 of ? die during their participation as passengers of space flight companies. In order to promote the emerging commercial space flight industry, various states, including Colorado, Florida, Texas, New Mexico, and Virginia, have enacted space flight limited civil liability laws to protect space flight companies from potential lawsuits brought by private citizens who participate in space flights. In California, space flight liability legislation was first introduced in AB 2834 (Maze, 2007), but that bill was never referred to a policy committee. To similarly encourage the space flight industry in California, this bill would enact a limited immunity from civil liability for space flight entities. CHANGES TO EXISTING LAW Existing federal law encourages private sector efforts to provide commercial space flight. (51 U.S.C.S. Sec. 50901 et seq.) Existing federal law provides for the licensing of entities who provide space launch and reentry services. (51 U.S.C.S. Sec. 50905.) Existing federal law requires a license holder who provides space launch and reentry services to inform the space flight participant in writing about the risks of the launch and reentry and requires that the space flight participant be informed in writing of relevant information related to the risk or probable loss during each phase of the space flight. (51 U.S.C.S. Sec. 50905(b)(5).) Existing law provides that everyone is responsible, not only for the result of his or her willful acts, but also for an injury to another caused by his or her lack of ordinary care or skill in the management of his or her property or person, except so far as the latter has, willfully or from lack of ordinary care, brought the injury upon himself or herself. (Civ. Code Sec. 1714(a).) This bill would require a space flight entity to provide, in addition to any language required to be provided by federal law, a space flight participant with the following warning of inherent risks associated with space flight: AB 2243 (Knight) Page 3 of ? WARNING AND ACKNOWLEDGMENT: I understand and acknowledge that, under California law, there is no civil liability for bodily injury, including death, emotional injury, or property damage, sustained by a participant as a result of the inherent risks associated with space flight activities provided by a space flight entity. I have given my informed consent to participate in space flight activities after receiving a description of the inherent risks associated with space flight activities, as required by federal law pursuant to Section 50905 of Title 51 of the United States Code and Section 460.45 of Title 14 of the Code of Federal Regulations. The consent that I have given acknowledges that the inherent risks associated with space flight activities include, but are not limited to, risk of bodily injury, including death, emotional injury, and property damage. I understand and acknowledge that I am participating in space flight activities at my own risk. I have been given the opportunity to consult with an attorney before signing this statement. This bill would require the space flight entity to obtain the participant's written acknowledgment of this warning. This bill would provide that a space flight entity's failure to comply with the written warning and consent requirements above shall prevent the space flight entity from invoking the limited immunity provided in this bill. This bill would provide the following definitions: (a) "participant" means a space flight participant as defined in Section 50902 of Title 51 of the United States Code; (b) "participant injury" means a bodily injury, including death, emotional injury, or property damage, sustained by the participant; (c) "space flight activities" means launch services or reentry services; and (d) "space flight entity" means any public or private entity that holds, either directly or through a corporate subsidiary or parent, a license, permit, or other authorization issued by the United States Federal Aviation Administration. This bill would provide that a space flight entity shall not be liable for participant injury arising out of space flight activities if both of the following apply: (1) the participant has been informed of the risks associated with space flight activities as required by federal law and the written warning AB 2243 (Knight) Page 4 of ? and consent requirements contained in this bill; and (2) the participant has given his or her informed consent that he or she is voluntarily participating in space flight activities after having been informed of the risks associated with those activities, as required by federal law and the provisions of the bill. This bill would provide that if the participant provides informed consent to the inherent risks specified in the warning, then a participant, his or her representative, including the heirs, administrators, executors, assignees, next of kin, and estate of the participant, or any person who attempts to bring a claim on behalf of the participant for a participant injury, shall not be authorized to maintain an action against, or recover from, a space flight entity for a participant injury that results from the risks associated with space flight activities. This bill would provide that a space flight entity is still subject to civil liability if the space flight entity does any of the following: (1)commits an act or omission that constitutes gross negligence or willful or wanton disregard for the safety of the participant, and that act or omission proximately causes a participant injury; (2)intentionally causes a participant injury; or (3)has actual knowledge or reasonably should have known of a dangerous condition on the land or in the facilities or equipment used in space flight activities and the dangerous condition proximately causes injury, damage, or death to the participant. This bill would specify that any limitation on legal liability afforded by this bill to a space flight entity is in addition to any other limitations of legal liability otherwise provided by law. This bill would specify that it shall be construed to limit the liability of a manufacturer of a part or component used in space flight activities if a defective part or component proximately causes an injury to the participant. This bill would make various legislative findings and declarations regarding space flight. COMMENT AB 2243 (Knight) Page 5 of ? 1.Stated need for the bill The author writes: The first human entered space over 50 years ago, a pursuit that was decades in the making. Every astronaut since has assumed the immense risk involved in being hurled into orbit to further human development through the exploration of countless scientific experiments producing everything from new consumer products and the expansion of communications to cures for diseases. Human space flight has been carried-out exclusively by government spaces agencies of the United States and Russia, with expertise provided by the private sector. With the retirement of the U.S. space shuttle program, innovators in private industry have developed new forms of space transportation vehicles and are being looked upon to fill the void of manned space flight. Undoubtedly, however, they face the risk of civil suits if anyone is harmed undertaking this inherently dangerous activity. In order to promote the emerging industry of private human space travel, California must provide innovators with regulatory latitude and limited indemnification from civil liability to ensure the state's competitive marketplace. 2. Immunity based on assumption of risk involved in inherently dangerous activities This bill would provide limited immunity from liability for a space flight entity if the entity provides a warning, as specified, of risks associated with space flight and the participant acknowledges these risks. This immunity is predicated on the participant assuming the risk of the inherently dangerous activities of space flight. a. Assumption of risk Under existing law, everyone is responsible, not only for the result of his or her willful acts, but also for an injury to another caused by his or her lack of ordinary care or skill in the management of his or her property or person, except so far as the latter has, willfully or from lack of ordinary care, brought the injury upon himself or herself. (Civ. Code Sec. 1714(a).) Under this provision, if a person injures another, the person may be held liable for the other's injuries. AB 2243 (Knight) Page 6 of ? However, the person who injures another may have a defense from liability based upon the doctrine of assumption of risk. The doctrine of assumption of risk is incorporated in Civil Code Section 1714(a) and provides that a person who injures another may not be liable if the injured individual brought the injury upon himself or herself. An assumption of risk defense is asserted on the basis of the plaintiff's consent to relieve the defendant of an obligation of conduct towards him, and to take his chances of harm from the particular risk. (Alcorn v. Davies (1959) 173 Cal.App.2d 569, 574-575.) Similarly, this bill, by requiring the space flight participant to acknowledge in writing the risks associated with space flight, and thus consent to exposing himself or herself to the risks of space flight activity, would relieve the space flight entity from liability for any injuries sustained by the participant during the space flight. The Commercial Spaceflight Federation, in support, argues that this bill "provides the necessary liability protections that will allow businesses in this sector to operate in an efficient and effective manner, and acknowledges that spaceflight is not a risk-free endeavor and passengers understand and acknowledge that risk." Further, they argue that this "Act must be in place for California to continue to be a leader in the industry." b. Inherently hazardous activity This bill would require a space flight entity to warn the space flight participant of inherent risks of bodily injury or death that may result from space flight activities. This warning effectively would deem space flight an inherently hazardous activity. An inherently hazardous activity is one in which the nature of the activity or substance is so inherently dangerous or complex that the hazard persists despite the exercise of ordinary care. (Benwell v. Dean (1964) 227 Cal.App.2d 226, 233.) Existing federal law requires space flight entities to provide to a space flight participant a written warning of the inherent risks, as provided by the Federal Aviation Administration (FAA), associated with space flight. (51 U.S.C.S. Sec. 50905(b)(5).) The FAA requires, among other warnings, space flight entities to warn a space flight participant of the risks of launch and reentry, including: AB 2243 (Knight) Page 7 of ? (1) for each mission, each known hazard and risk that could result in a serious injury, death, disability, or total or partial loss of physical and mental function; (2) that there are hazards that are not known; and (3) that participation in space flight may result in death, serious injury, or total or partial loss of physical or mental function. (14 C.F.R. 460.45(a).) Further, the FAA requires the space flight operator to inform each space flight participant of: (1) the total number of people who have been on a suborbital or orbital space flight and the total number of people who have died or been seriously injured on these flights; and (2) the total number of launches and reentries conducted with people on board and the number of catastrophic failures of those launches and reentries. (14 C.F.R. 460.45(c).) These warnings serve to educate the space flight participant on the potential harm that may result in voluntarily participating in space flight activities. The FFA regulations also require that, before flight, a space flight operator must provide each space flight participant an opportunity to ask questions orally to acquire a better understanding of the hazards and risks of the mission, and each space flight participant must then provide consent in writing to participate in a launch or reentry. The consent must: (1) identify the specific launch vehicle the consent covers; (2) state that the space flight participant understands the risk, and his or her presence on board the launch vehicle is voluntary; and (3) Be signed and dated by the space flight participant. (14 C.F.R. 460.45(f).) Given the extensive warning of risks associated with space flight required to be provided under federal regulations, in addition to the warning required under this bill, the opportunity to ask questions about the inherent risks associated with space flight, and the opportunity to consult with an attorney prior to consenting to voluntarily participate in a space flight, the space flight participant is arguably well-informed of the risks associated with the potential for serious injury or death. If the participant then consents to participate in the space flight, then the doctrine of assumption of risk would arguably relieve the space flight entity of liability. This bill would codify the doctrine of assumption of inherent risk associated with space flight and make the space flight entity immune from liability. AB 2243 (Knight) Page 8 of ? c. Arguments in support of immunity for assumption of inherent risks Supporters of this bill assert that the commercial space flight industry feels vulnerable to law suits that may arise if passengers are injured or die during commercial space flight. Indeed, the commercial space flight industry is working to get state laws passed that limit their liability for participants injured as a result of the inherent risks associated with commercial space flight. Since California is an industry leader in commercial spaceflight and home to the nation's first licensed commercial spaceport, housed in Mojave, proponents of the bill argue that California must enact similar legislation to remain competitive and not lose industry jobs to the other states that have enacted limited civil liability laws for commercial space flight. Virgin Galactic and The Spaceship Company, in support, assert that "the human spaceflight industry and the jobs it creates require sensible regulation governing liability." Further, they argue that "the net effect of AB 2243 will be to provide Ýtheir companies] with important assurances that are already offered by a growing number of competing states . . . and ensure that California remains a center of American aerospace leadership." They also assert that their "companies have invested Ýsince 2005] approximately $200 million in California, and created or supported roughly 500 high quality jobs in the state." Mojave Air & Space Port, also in support, argues that time "is of the essence" and California "must take all means to insure barriers such as civil liability litigation does not hinder the efforts of those that strive to innovate." 3. Providing civil liability for space flight entities in some circumstances This bill makes it clear that nothing in this Act limits the liability of a space flight entity whose gross negligence or willful or wanton disregard of the safety of a participant was the proximate cause of the participant's injury. This bill also makes it clear that nothing in the Act limits the liability of a space flight entity that intentionally causes a participant injury, or had actual knowledge or reasonably should AB 2243 (Knight) Page 9 of ? have known of a dangerous condition that proximately caused the injury or damage to the participant. 4.Civil liability of manufacturers of defective parts or components This bill does not extend limited civil liability to product defects shown to be the proximate cause of injuries. The bill makes it clear that there is no limited liability for a manufacturer of a part or component used in space flight activities if a defective part or component proximately causes injury to the participant. 5.Suggested amendments This bill contains two technical errors and one substantive issue that should be resolved. a. S tatements in findings and declarations Section 2 of the bill includes findings and declarations that are opinions and not substantiated by evidence. As a matter of policy, these unsupported findings and declarations should be stricken. Accordingly, this bill should be amended as follows: Suggested amendment: Page 2, strike lines 3 through 23 Page 2, line 24, strike "3" and replace with "2" b. Technical error in Warning and Acknowledgment The statement in the "Warning and Acknowledgment" that "under California law, there is no civil liability for bodily injury . . ." does not conform to the limited liability provisions contained in this bill. To accurately inform participants about the limited liability provided by this bill, the following amendment is suggested: Suggested amendment: Page 3, line 24, strike "no" and replace with "limited" c. Technical amendment to correct cross-reference AB 2243 (Knight) Page 10 of ? The following amendment is also suggested to correct and internal cross-reference: Suggested amendment : Page 4, at line 13, strike "this section" and insert "Section 2211" Support : Commercial Spaceflight Federation; Mojave Air & Space Port; The Spaceship Company; Virgin Galactic Opposition : None Known HISTORY Source : Author Related Pending Legislation : None Known Prior Legislation : AB 2834 (Maze, 2007) See Background. Prior Vote : Assembly Floor (Ayes 73, Noes 0) Assembly Judiciary Committee (Ayes 10, Noes 0) **************