Blitz USA is based in Miami, Okla., and is the largest manufacturer of portable gas cans in the country.
The company, founded as U.S. Metal Container, started by selling olive-drab “jerry cans” to the U.S. military. The green cans were later painted red and shipped to non-military retailers, and in 1992 the company changed its name because most of its products were no longer metal — they’re now plastic.
Those red plastic fuel containers are ubiquitous, especially during the summer, when landscaping crews are out in full force.
But Blitz has filed for bankruptcy and will shut its doors at the end of the month. Why? Because it can no longer afford product liability insurance, Marketplace’s Sally Herships reports.
Deductibles for product liability insurance are often in the tens of millions of dollars, an expert in product liability law tells Marketplace. The rates go up even more if you have to use it, and Blitz is currently fighting 42 lawsuits.
Most of lawsuits against Blitz were brought by the same three lawyers, Marketplace reports.
Consumers have accused the company of making faulty cans that explode when used to pour gasoline onto fires.
Blitz says its cans carry warnings that say you should never use gasoline to start or accelerate a fire.
Even winning is expensive. Blitz beat one lawsuit in Texas, Marketplace reports, but the fight still cost the company about $2.5 million.
“We have been operating under extremely litigious environment and have been working toward a solution for quite some time,” the company’s president, Rocky Flick, and its director or product development, Grant Kernman, wrote in a 2011 letter to its customers. “The defense costs related to increased litigation associated with fuel containment products is the primary factor that leads to our current situation.”