Analyzing Product Liability and Corporate Governance Standards

This assignment presents a case study analyzing product liability and corporate governance, referencing the McDonald's hot coffee lawsuit. It discusses the court's decision, McDonald's breach of implied warranties, and the secret settlement reached. The analysis highlights the drawbacks of secret settlements in preventing public awareness of product liability law consequences. It recommends manufacturers take precautions, especially for senior citizens, and suggests businesses be held liable for defective product accidents. McDonald's is advised to lower beverage temperatures and warn customers. Consumers are encouraged to be informed about product characteristics. Desklib offers similar solved assignments for students.

CORPORATE GOVERNANCE AND SOCIAL RESPONSIBILITY

QUESTION 7
• Court held McDonald liable to compensate the Ms. Liebeck.
• McDonald’s has breached implied warranties of merchantability and
fitness (Johnson, 2018).
• The court held the plaintiff responsible to some extent for the
accident and therefore reduced the compensation amount claimed by
the plaintiff initially (Solberg & Hosack, 2017).

QUESTION 7 CONTINUED…
• The parties entered into a secret settlement where Ms. Liebeck have
probably settled for a lesser amount than what she had initially
claimed.
• The amount of compensation and punitive damages remains
unknown to the world.
• Even though such secret settlement is allowed by the law of contract,
however, it prevents the common people from learning the final
outcome of the consequence of infringement of product liability law.
• It is a drawback of the legal system.

QUESTION 8
• Manufacturers are recommended to take all necessary precaution regarding the
products, especially to senior citizens.
• Companies to be more cautious while dealing with senior citizens.
• Businesses should be held liable for the accidents that customers face due to the
defective products of such businesses. With the growing global age, there should be
better customer service, especially for the old people who are much more dependent
on others for their incapacity to hardship due to old age.
• McDonald’s is advised to lower the temperature of the beverages to ab endurable
threshold that would not harm the consumers, especially while serving senior citizens.
• McDonald’s is recommended to provide necessary training to their servers to warn the
customers about the high temperature of the drink, while serving (Tulibacka, 2016).

QUESTION 8 CONTINUED…
• Consumers are advised to have some knowledge about the products
they are consuming, regarding their composition, temperature so that
they do not encounter any harm from it.
• Consumers, especially the old ones are recommended to ask the
servers about the temperature of the drink, whether it can be readily
consumed or requires a waiting time.

REFERENCES
• Solberg, J. J., & Hosack, K. A. (2017). Recent Trends in Punitive
Damages Jurisprudence: Are Excessive Awards Galloping Away, or Are
Courts Acting in Good Faith to Rein Them In?. Southern Law Journal,
27(1), 113.
• Tulibacka, M. (2016). Product Liability Law in Transition: A Central
European Perspective. Routledge.
• Johnson, M. H. (2018). Essential reproduction. John Wiley & Sons.

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