The Ethical Issue

Posted: October 17th, 2013

The Ethical Issue

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The Ethical Issue

Should companies be able to escape liability for defective products that were the subject of government regulations?

Companies have legal liabilities of the goods they make, sell or lease to the people who use or buy the goods (Miller & Jentz, 368). Most claims are based on torts of negligence and strict liability. They can also be based on misrepresentation and warranty theories. The government has established many regulations, which are intended to protect the consumers from harm. Regulatory laws set by the federal and state governments have authorize manufacturers to warn the consumers concerning any risks and hazards that might occur when using the product. Many companies abide by these rules, and many plaintiffs have a hard time proving their case in court since it is hard to prove that a product was defective if it meant the federal regulations. Claims are based on state laws since there are no federal product defect laws. The main types of product defects are design, manufacturing, and marketing defects. Defects in manufacturing occur when the product is damaged in the process of manufacturing. A design defect means that a product’s design is dangerous. The manufacturer may have followed the right specifications when making the design but the design might be dangerous when used. A marketing defect happens when the manufacturer or the one marketing the product fails to include warnings concerning the danger or harm that might result when using the product or adequate instructions on how to use the products (Goldman & Sigismond, 299).

Companies go to great lengths to ensure that their products are accepted in the market, and that they return the profits expected. They ensure that they comply with the industry and government standards. The industry standards set the minimum requirements and standards for the company to follow when producing the products. The government standards ensure that the products do not cause harm to the consumers. Companies know that they tend to lose more when they violate the rules, and they face the risk of closure. Companies should only face liabilities when they show evidence that they violated the industry and government standards. The company should show that they did all they could to ensure that they manufactured the products without defects. Companies achieve when they show that they have complied with the government standards, and the FDA.

Companies that produce defective products that have been produced by another company successfully, should be held liable even if they comply with the government regulations because it shows negligence on their part. Rebuttable presumptions are applicable in some states. In the case Bailey v. Wyeth, (Bailey v. Wyeth Inc., Dkt. No. L-0999-06) the judge ruled that the defendants had acted within the law and within the government standards, since they had provided adequate warning (Feinblatt & Arndt, 2008). In some instances, the government or the companies recall the products when they notice defects. This usually happens when consumers have used the product and it has endangered or harmed them in a way. The government does not always recall defective products, and it usually acts when the people who have been affected by the products sue the company or other people who were involved in manufacturing the products.

References:

Feinblatt, M. S., & Arndt, A. K. (2008). State products liability act: The FDA rebuttable presumption. New Jersey Law Journal CXCIV (4)

Goldman, J. A., & Sigismond, D. W. (2010). Business law: Principles and practices. New York, NY: Cengage Learning

Miller, L. R., & Jentz, A. G. (2010). Business law today: The essential. New York, NY: Cengage Learning