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Current state regulations are almost universally aimed at manufacturers and the testing process.

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These regulations also tend to be aspirational, as they target level 3 and level 4 autonomous vehicles—vehicles that for the most part are only now beginning to be developed. Because much level 3 and level 4 autonomous vehicle technology is unknown and, to any extent known, constantly being updated, these regulations are mainly focused on future risk prevention. The uncertain future of autonomous vehicle technology dominates state regulatory concerns.

Should an accident with an autonomous vehicle occur, state regulations are aimed at ensuring that any damages are paid for. Although there is no evidence that test vehicles will be more dangerous on the road than ordinary vehicles and their human drivers—one of the goals of autonomous vehicles, after all, is to reduce accidents due to human error—this insurance requirement highlights the uncertainty of the risk associated with autonomous vehicles.

Highlighting the different approaches to this field, the various states with regulations also have put in place differing emergency control, geographical, permitting, licensing, and driver restrictions for the testing process. California, Michigan, and Florida have no geographical limits for testing. Nevada, however, has created six different geographical categories and five environmental types. Nevada additionally requires that a vehicle must have been safely driven in autonomous mode for not less than 10, miles before it is permitted on public roads.

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California requires test drivers to obtain a Test Vehicle Operator Permit from the state. The test driver must have a clean driving record with no at-fault accidents resulting in injury or death and no convictions for driving under the influence of intoxicants in the past ten years. Nevada requires that the local DMV shall establish an endorsement system for autonomous vehicle drivers. Nevada also requires two licensed drivers in a test vehicle.

Michigan only requires a special plate on test cars. Current regulations target manufacturers, not consumers. As autonomous vehicle technology nears a point of readiness for general use, not only must the substance of the regulations change, the focus must shift away from manufacturers onto consumers.

For autonomous vehicles to impact the market in the way they are predicted to, regulations will have to be issued that, while keeping the public safe, do not create such a burden so as to either make the purchase and operation of autonomous vehicles inconvenient or result in barriers of entry for smaller companies wishing to enter the market. State regulatory agencies and legislatures must be careful when regulating for the general public. At the moment, too-forward-leaning legislation is ill-advised. An example of this may be the current requirement in California, Nevada, Michigan, and Florida that test drivers must be able to reassume immediate control at any time in the event of an emergency.


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Companies must be aware of the symbiotic relationship between technological advancement and state regulation. As autonomous vehicle technology improves, it will be of the utmost importance that manufacturers have ways of communicating with state lawmakers and vice versa. Only then will state regulations be able to not only keep pace with technological advancements—thereby keeping the public safe—but also be able to update themselves in a way so as not to impede the evolution of autonomous vehicles.

Manufacturers should consider playing a role in crafting the types of regulations necessary for a successful—yet safe—transition from the testing process to the public roadways. Considerations include:. As the advent of fully autonomous vehicles or vehicles that incorporate more and more autonomous technology draws ever closer, manufacturers should be mindful of the regulatory environment, how changes may affect them, and what role they might play in helping to craft them.

State and federal rule-makers are not the only voices in the room; auto manufacturers have their own opinions. Changing the federal motor vehicle regulations to accommodate fully autonomous vehicles will take not only an inordinate amount of time but perhaps, in some circumstances, congressional input. As a result, until the federal regulations have actually been changed, auto manufacturers should be wary of underestimating the impact and reach of state regulations.

Autonomous vehicle manufacturers should be prepared to face complex challenges and be willing to cooperate with cities, local governments, private companies, and residential communities to solve them.


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  • Several big-picture challenges will likely include:. These potential consequences are complex, difficult to deal with, and affect the entire world. These are just a few of the consequences of future roads populated by autonomous vehicles. By some projections, upwards of 50 million autonomous vehicles will be in use globally by If such an estimate is to become reality, however, a multitude of issues must be addressed, many of which are discussed in this White Paper.

    Of particular importance is the issue of liability. Traditional vehicles have been a fertile source of lawsuits, including those related to gas tanks, ignition switches, air-bags, and safety belts. With the rise of autonomous vehicles comes new and complex questions of liability for when the vehicles do not perform correctly, resulting in harm to someone or something. This section explores what that liability landscape may look like. Although some of the issues presented by autonomous cars may be novel, existing liability frameworks are likely well- positioned to address these issues.

    As new technologies have evolved over the years, so too has product liability law, and it is expected that it will be capable of doing the same with respect to autonomous vehicles. When discussing potential liability associated with autonomous vehicles, a key threshold issue is whether legislation will permit the use and operation of self-driving vehicles on highways, roads, and local streets, and if so, under what circumstances. This legislation is necessary for widespread development and will likely frame or limit the liability environment for vehicles, equipment, and technology manufacturers.

    Similar to pharmaceuticals and medical devices, the development of these technologies will have broad application and benefit to society, so manufacturers will require a legislative framework that provides them with limitations on product liability for injuries and property damage.

    Without such a framework, companies will likely be hesitant to implement products and technology or will do so in limited form or use. At the time this went to press, only Florida, Nevada, Michigan, and the District of Columbia have enacted statutes limiting product liability actions against OEMs when the action is based upon a defect in an autonomous vehicle. Each statute generally provides that OEMs are not liable for defects in an autonomous vehicle if the defect was caused when the original vehicle was converted by a third party into an autonomous vehicle or if equipment installed by the autonomous vehicle creator was defective.

    OEMs remain liable for any defects in the original design or manufacturing process. California law distinguishes between autonomous vehicle manufacturers and OEMs but does not expressly shield OEMs from liability relating to autonomous vehicles. The California Legislature has largely delegated regulation of autonomous cars to the Department of Motor Vehicles, which is charged with adopting and administering licensing requirements as well as safety and performance standards and is required to hold public hearings on the adoption of any regulation applicable to the operation of an autonomous vehicle without the presence of a driver inside.

    The United States is arguably the most progressive country in the world in terms of autonomous driving, but, as mentioned in the section above, this position could be eroded if a national framework for regulation and testing is not developed. If 50 states have 50 different regulations, it would be difficult for manufacturers to comply with all of them.

    One option, then, is for the federal government to preempt state laws by creating its own regulations for autonomous vehicles. Undoubtedly, Congress has the power to regulate vehicles as instrumentalities of interstate commerce, pursuant to the Commerce Clause of the US Constitution.

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    In addressing liability, Congress could mirror legislation such as the National Childhood Vaccination Injury Act of Importantly, injured plaintiffs are not left without a remedy. The law established a compensation program designed to compensate individuals who have been injured by certain childhood vaccines, and it allows injured plaintiffs to adjudicate their claims before the US Court of Federal Claims.

    Analogously, if Congress embraces autonomous vehicles as a major improvement to transportation safety, it could consider passing legislation that provides qualified immunity for OEMs, thereby assuaging concerns over potential liability. Assuming an absence of either a state or federal legislative framework addressing liability, OEMs will be forced to operate under traditional theories of product liability.

    A product liability suit can allege any or all of these theories. This first category of defect, however, presents a major hurdle to plaintiffs: no courts have applied manufacturing defects to software, because nothing tangible is manufactured. Therefore, if the alleged defect stems from an error in the autonomous software or algorithm, plaintiffs may be unable to avail themselves of traditional product liability law on manufacturing defects.

    A manufacturing defect theory may only be useful to a plaintiff when the parts themselves did not meet the manufacturing specifications. An understanding of the technology and how it interfaces with other components or systems will be essential to determining whether a manufacturing defect theory can be pursued.

    The second category of defect, and perhaps the most significant for autonomous vehicles, is a design defect.

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    Showing that a safer design would have prevented the accident could create an incredibly high burden of proof, however, and also may make it difficult to find qualified experts with legitimate experience. This test, however, is losing favor in many states and was rejected by the Restatement Third for design defects. Such an expectation, however, is likely unrealistic. Many anticipate this theory to be the most likely and least complicated avenue for potential recovery if plaintiffs can find and afford the multiple experts necessary to deal with computer hardware and software technology, cost analysis, and the appropriateness of certain instructions or warnings with regard to these types of vehicles.

    But if an autonomous vehicle is involved, the liability dynamics go beyond those of a conventional vehicle accident. In fact, a plaintiff could have at least four, nonexclusive options to pursue. In a different scenario, what if an autonomous vehicle has alerted the occupant of a malfunction, but the occupant is unable to disengage autonomous mode and take control before an accident occurs? Second, the plaintiff could bring suit against the OEM, those who manufacture the original vehicle. For instance, Google initially used the Toyota Prius to test its driverless technology.

    Toyota, in that case, would be considered the OEM. However, if states like Nevada and Florida are any indication, the option to sue OEMs will likely be foreclosed as more and more state legislature pass laws limiting product liability for OEMs. Third, the plaintiff may choose to sue the company that created the finished autonomous vehicle.

    Volvo is one such example, as it is in the process of developing its own line of driverless cars, called Concept Volvo was one of the first automakers to make such a pledge, and it has challenged other automakers to follow suit in hopes of expediting the creation of federal regulations for autonomous vehicles.

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    Finally, the plaintiff may have the option of suing the company that developed or created the autonomous technology. The takeaway here is that plaintiffs will find no shortage of parties to potentially hold responsible. Autonomous vehicles involve multiple layers, from design, to manufacturing, to operating. With each layer comes an opportunity for negligence or product defects, and rest assured plaintiffs will attempt to exploit all of them in an effort to maximize their chances for recovery.

    Regardless of the product liability theory a plaintiff relies upon, two evidentiary issues are likely to come into play: expert testimony and subsequent remedial measures. Due to the complexity of autonomous vehicle technology, a plaintiff will need expert testimony to explain product safety and accidents to the court and the jury. For instance, under a design defect theory, the plaintiff may have to present evidence explaining how a complex algorithm could have been written safer and that the costs of discovering and implementing this new algorithm would not exceed the benefits of doing so.

    This will require a computer scientist to understand the algorithm, a mathematician to rewrite the equation, an economist to weigh the costs and benefits of the change, and an expert in autonomous vehicles to confirm the possibility of the change and that it would not negatively impact the vehicle. To help reduce these costs, a plaintiff may be able to use a subsequent update in the algorithm or safety update as evidence that there was a reasonable alternative design.

    The ability to introduce subsequent remedial measures, however, will largely depend on the jurisdiction.

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