Infamous Lawsuit Liability

Regs & Legs

Infamous Lawsuit Liability

Anyone can sue anyone over anything. Winning, however, is a different matter. By design, the American legal system weeds out frivolous lawsuits. Even if a lawsuit escapes earlier roadblocks, the judge holds the power to reduce an unwarranted jury award. For instance, in the McDonald’s hot coffee case, the jury awarded $2.7 million in punitive damages. The judge reduced it to $480,000, and McDonald’s ultimately settled for a lesser, undisclosed amount. A decade later, this case has become urban legend and has shaped the public’s perception of tort law. Urban legends about frivolous lawsuits winning millions are unfortunate, reducing our faith in the legal system, and fostering a belief that nothing a company does is of any consequence in preventing or winning such lawsuits.

A little knowledge and diligence go a long way in lawsuit prevention. These legal actions are called torts. Here are some essential facts about tort liability:

Strict liability: A person injured or made ill by a food containing a dangerous object or deleterious substance may recover damages from the manufacturer under strict liability if the food was “unreasonably” dangerous. A jury decides what is unreasonable, but the bottom line is that the court will look at similar products and determine whether the food met applicable standards. Liability increases the further a food falls below industry norms, internal standards and regulatory requirements. Conversely, the degree to which a food meets or exceeds comparable products and standards, the stronger the defense.

Breach of implied warrant: A person injured or made ill may recover damages from manufacturers or sellers of the product for breach of the implied warranty of merchantability. Proof that the food was wholesome or fit for consumption —at least when it left your control —is a key defense. This proof might include written procedures to ensure wholesomeness and solid record-keeping that documents that fact.

Negligence: This requires proof of five elements—duty of care for the defendant; breach of that duty; cause-in-fact of injury; within the scope of liability; and damages. Defenses to negligence include those listed for strict liability. An additional defense is proof that a firm met its duty of care in producing, marketing or selling the implicated food. These claims are not as common as strict liability and warranty because of the higher burden of proof to demonstrate that a firm failed to exercise reasonable care.

Misrepresentation or nondisclosure: With food products, misrepresentation or nondisclosure generally arise from the premise that the manufacturer concealed material information or misrepresented information to the consumer. This applies when they cause one of the three torts described above. For example, failure to disclose the presence of peanuts in a food might create an action in strict liability because the food is unreasonably dangerous to people with peanut allergies. The law puts a heavy burden on food manufacturers. Nonetheless, armed with a little knowledge, avoiding legal-liability landmines is relatively straightforward, even if not always easy.