Interesting, never heard of the case.
People like sensations. They also dislike thinking about mental illness, because it is so... intangible? non-grappable? You cant hide from it behind a filter, cut it away or treat it without seriously messing with yourself.
Two good reasons for it to turn into what it did.

While I agree with most of your conclusion, I have one big disagreement with something you implied. (Maybe you didnt and I misinterpret, which makes the whole argument mute. Sorry for waisting time in that case.) I am also going off-topic here.

While the health/safety issue with not protecting the watersupply is very problamatic, I do not agree with the assumption that the tanks should have to be drownproofed somehow. I am sorry for the poor girls death and her families suffering, but businesses do not exist to prevent people from doing bad/harmful/stupid things.

Favorite example (really off-topic now, no comparison):
If you burn your hand on the hot coffee you just ordered, your an idiot. I you blame the cafe and sue them for not warning you that the hot coffee is indeed hot, your a idiot³. Dont even get me started on the judge that rules you to be right...