Strayer University Assignment # 4 Products Liability Research Paper Feliciano Sena Dr.

Mark Davis Leg 500 Law and Ethics in the Business Environment Assignment #4 Spring 2012

Leg 500- Law and Ethics in the business Environment. Product Liability Research Paper: Select a Company that has been the subject of a product liability lawsuit in the last five (5) years. Liebeck v. McDonalds Restaurants, This case was also popularized as McDonalds coffee case. This is perhaps a 1994 most renowned liability lawsuit, which became the flashpoint in the U.S. debate reform after a jury decided to award the plaintiffs the amount of $164,000.00 just for medical expenses. Another 2.7 million were added to pay for in punitive damages. Mrs. Stella Liebeck was awarded this amount of money, because she had suffered 3rd degree burns in her pubic region when the coffee she bought from McDonalds restaurants was spilled on her laps. As we all know McDonalds is one of the most famous chains of fast food restaurants around the world. The trial judge assigned to this famous case reduced the final decision (verdict) was adjudicate to a group of judges and the parties, and the amount of dollars paid was confidential, before an appeal was decided. This case was commented by a great deal of people as a good example of frivolous litigation, For example the ABC News named this case the poster child of excessive lawsuits. Some others found it to be a meaningful and worthy lawsuit. Legal theories used by the plaintiffs were that McDonalds coffee is addictive it was also too hot causing serious damages than coffee served in other public establishments. McDonalds was therefore very reluctant to settle in other several occasions for less than $ 640,000.00 that was ultimately awarded.

3 Supporters of tort reform were claiming that the public perception of this case was completely materially correct, I myself support this ideal, and found out that McDonalds was supposed to accept the fined amount offered to settle the case without going any farther. A great majority of judges considered to dismiss the case before it hit the jury alleging that they have considered similar cases before, and agreed to that McDonalds should accept to pay. McDonalds reluctance to honor $800.00 settlement for the $ 10,500.00 in individual bills reflected the merit less nature of the suit, basing their case on the facts that Mrs. Libeck was care less spilling the hot coffee on herself, rather than admitting any wrong doing on the companys part. Mrs. Liebeck 79 years old and a resident of Albuquerque, New Mexico, went to McDonalds and trough the drive through window ordered a 49 cents cup of coffee from a local McDonalds restaurant situated at 5001 Gibson Boulevard S.E. This happened on February 27th,1992. Mrs. Liebeck was sitting on the passenger side seat of her grand son Chris who was driving the car at the time, a Ford Probe, and they decided to park so Mrs. Liebeck could add what she liked to her cup of coffee placed between her knees. When she pulled the lid of the cup of coffee towards her to have it opened she spilled the entire cup of coffee on her laps. Mrs. Liebeck was well dressed with cotton sweatpants. These pants absorbed the hot coffee, scalding her tights, buttocks and groin and her pelvic skin then her grand son Chris, decided to take her to the nearest hospital. Where the doctors determined that she had suffered third degree burns on at least six percent of her skin and lesser burns over sixteen percent. Mrs. Liebeck was admitted to

4 the hospital and kept there for eight days, where she underwent skin grafting. During this time Mrs. Liebeck lost about 20 pounds a considered weight reduction caused by her burns. On top of this weight lost she was kept in the hospital for treatment, for almost two years. Mrs. Liebeck tried to settle with McDonalds for $20,000.00 to her actual and anticipated medical expenses. She accumulated about 10,500 for her past medical expenses, and by then she had about 2,500 on medical expenses and her lost of income of about $5,000.00 for a total lost of approximately $18,000.00 McDonalds, but the company instead offered the $ 800. McDonalds was totally reluctant and Mrs. Liebeck then decided to retain a Texas Attorney, Mr. Reed Morgan. Her lawyers filled suit in New Mexico District Court accusing McDonalds of a gross negligence for selling coffee that was unreasonably dangerous they also found out that the coffee defectively manufactured. McDonalds also refused Morgan offer to settle for $ 90,000. McDonalds was determined to reject all kind of offers. Morgan then offered to settle for $300,000.00 and a mediator suggested $225,000.00 just before the case hit the court for trial, but McDonalds once again rejected the final trial attempt to settle before going to court. The changes that have taken place in the company to assure greater safety of this consumers and users who purchase and use its products. This trial was settled to take place on August 8th1994 in front of Judge Robert H. Scott during the term of this case Mrs. Liebeck counselors discovered that McDonalds was asking and ordering franchises to serve coffee at a lower temperature of 180* Celsius Degrees to 190* F (82-88 Degrees Celsius).

5 Considering that at that temperature the coffee, would reduce these burns in two to seven seconds. Estelle Liebeck attorney then argued that coffee should never be served hotter than 140 degree F (60 Celsius) and therefore a great number of establishments were serving coffee at a lower temperature than McDonalds. Mrs. Liebecks attorney presented the jury with clear evidence that 180*F(82*C they found out that coffee like the one served at McDonalds may produce third degree burns( where king grafting is necessary in approximately 12 to 15 seconds. By lowering the coffee temperature to 160*F (71*C) would increase the time for the coffee to produce such a burn to just 20 seconds. Later on a British Court ruled that these arguments were scientifically false and therefore they were inadequate because deep tissue damage in only two seconds, according to Mrs. Liebecks lawyers. McDonalds then claimed that their reason for serving such a hot coffee, in their drive through windows was to better serve those typically consumers who wish to drive a longer distance with their coffee cups, during their trip. However later on, the company found out that the majority of the customer wanted to consume their coffee right away. McDonalds had shown some other documents to demonstrate that from 1982 to 199010 years, the company have been receiving over 700 reports of people that have been burned by McDonalds coffee to change degrees of severity, and had also settled a variety of claims arising from scalding injuries for more than $500,000.oo Christopher Appleton is the Quality Control Manager, and he had certified that this number of injuries was a not enough to cause the company to change or evaluate its practice.

6 He based his arguments saying that all foods hotter than 130 degrees*F (54*C) provoked a burn hazard, and that restaurants have some other more important things to worry about. According to the plaintiffs Mr. Appleton indirectly admitted that McDonalds coffee would burn the mouth and throat of peoples if consumed right after its served. I do agree, that cooked food should be served while its hot and the company or restaurant should served it in heavy containers to avoid any harm to the clientele, of course alerting the customers that the product have been taken out of the oven. When you go the any restaurant or drive through window, you decide what you like and you are supposed to check the quality or condition of your order to fulfill your satisfaction. As a manager I would strongly recommend to have signs on the containers alerting the customer about the condition of the product served to them at that moment, and also will tell them to be careful. A good example of these practices is, can I have a cup of Hot Chocolate? Can I please have a hot Cup of Coffee? Knowing and having all advises, I am tempted to believe that the Jury was a little bit too lenient and probably biased after McDonalds refused to accept to settle the case before going in front of a Judge. In this course I have learned a great deal about compositions and regulations about Businesses, Industries, and companies functioning within and outside of the United States of America. I am even more convinced that this is the country where everything is regulated and those regulations must be fulfilled. This is the best Professor that I have ever had throughout my entire career.

7 Recovering U.S FDA Registration Information for your Food facility. The U.S FDA Regulation; is the Agency that oversees and required from all companies that manufactures, process, pack or, store food, beverages or dietary supplements that would be consumed in the United States. Companies or industries located outside the United States must designate a U.S. Agent for FDA communications. The U.S. FDA has estimated that the grand total number of food facilities that must register are about 420,000 and about half 210,00 of them are domestic. By January 14th 2009, U.S. FDA had received 578,375 applications, and 367,000 are Foreign Businesses and approximately 150, 775 are domestic businesses. Companies that are legally registered with the U.S. FDA are often asked by their customers and some other individuals suppliers, about their U.S. FDA food Facility Corp serves to verify their compliance with the departments, and the food facility registration requirements to satisfy the Bioterrorism Act. Every registered company must show its Certificate of Registration with the Department. They all should have a Certificate of Registration issued by the corresponding registrar, or have in a visible place their Certificate issued by the U.S. FDA (food Facility Registration Information). If by any reason some one has misplaced their required information as demanded by the U.S. FDA. Registration Corp assists companies in recovering U.S.FDA Registration Information as demanded by the U.S.FDA Regulations.

Sources:

8 These are Official Educational Academic sources. Educational Research www.Directexbook.com. This is rated as a five 43 reviews 50% bookstore Prices! With coupons and shipment discounts. Dartmouth College. www.dartmouth.edu/ Academic Journal Library/Questia.com www.questia/journals.

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References:

9 Liebeckv.McDonalds P.T.S.Inc .No D-202CV-9302419, 1995 W.360300 (Bernalillo Country N.M. Dist Ct. August18, 1994}

Doroshow, Joanne (June 26, 2011) Watch Hot Coffee, a powerful New Film on HBO June 27 Huffington Post. Retrieved 20 June 2011.

Andrea Gerlin, Wall Street Journal, A Matter of Degree How a Jury Decided that a coffee Spill is Worth $ 2.9 Million, September 1, 1994,p A1,available from Reed Morgans websites.

Liebeck v. McDonalds Restaurant, docket entryfromnmcounts.com..08/181994 NCJ: JuryTrial.12 Person: Filing Judgment entered solely against DF McDonalds and to PL,for compensatory damages of 160,000.00 and punitive damages of 0$2,700,000.00 plus interest and costs.

Amended Complaints for Damages, Stella Liebeck, plaintiff v. McDonalds Restaurants, P.T.S,Inc. and McDonalds Corporation Defendants 1993 WL.13651163, District Court of New Mexico, (Bernalillo County. N.M. District Ct October5, 1993)