1. Section 15.2

2. What You’ll Learn
How to differentiate between product liability and strict liability (p. 327)
How to describe the purpose of the Consumer Product Safety Act (p. 329)

3. What You’ll Learn
How to identify the prohibitions contained in the Food, Drug, and Cosmetic Act
(p. 329)
How to determine where to get consumer protection assistance (p. 330)

4. Why It’s Important
Learning about product liability law will help you take effective action if you or a family member suffers injury from faulty products.

5. Legal Terms
product liability (p. 327)
strict liability (p. 327)
adulterated (p. 329)
intrastate sales (p. 330)

6. Section Outline What is Product Liability?
Strict Liability
Federal and State Consumer Protection Laws
Consumer Product Safety Act
Food, Drug, and Cosmetic Act
State and Local Laws

7. Section Outline
Consumer Protection Assistance
Better Business Bureau

8. Pre-Learning Question
What do you think product liability is?

9. What Is Product Liability?
Under product liability law, someone who is injured from a product’s unsafe or defective condition may recover damages. Manufacturers, sellers, and suppliers of goods can all be held responsible.

10. Strict Liability
You do not have to prove a negligent act on the part of the manufacturer or seller if you are hurt using a defective product.

11. Strict Liability
Strict liability makes manufacturers or suppliers responsible for selling goods that are unreasonably dangerous.

12. Strict Liability
People who are injured or who suffer property damage from a defective product may recover from the manufacturer or seller if they can prove all of the following:

13. Strict Liability
The manufacturer or seller was engaged in the business of selling the product.
The product was unreasonably dangerous to the user or consumer.

14. Strict Liability
The defective condition was the cause of the injury or damage.
The defective condition existed when the product left the hands of the manufacturer or seller.

15. Strict Liability
The consumer suffered physical harm or property damage as a result of using the product.

16. Pre-Learning Question
What are some federal and state consumer protection laws?

17. Federal and State Consumer Protection Laws
Both the federal and state governments pass laws to protect consumers in the marketplace.

18. Federal and State Consumer Protection Laws
Two federal laws are the:
Consumer Product Safety Act
Food, Drug, and Cosmetic Act

19. Consumer Product Safety Act
This law protects you from unreasonable risk of injury while using consumer products that are sold in interstate commerce.

20. Consumer Product Safety Act
Defects in products are divided into three categories:
Manufacturing defects
Poor design
Inadequate instructions and warnings about the safe use of the product

21. Food, Drug, and Cosmetic Act
This law prohibits the manufacture and shipment of faulty products in interstate commerce.
Faulty products include any food, drug, cosmetic, or health-related device that is injurious, adulterated, or misbranded.

22. Food, Drug, and Cosmetic Act
A food or drug is said to be injurious if it contains any substance that may make it harmful to health.

23. Food, Drug, and Cosmetic Act
An adulterated food or drug is one that contains any substance that will reduce its quality or strength below minimum standards.

24. Food, Drug, and Cosmetic Act
A food or drug is misbranded if its labeling or packaging is false or misleading.

25. Food, Drug, and Cosmetic Act
The government uses other methods to discourage the sale of goods considered harmful to the public health. They include:
Unusually high taxes
Labeling and packaging
Outright prohibition

26. 15.2
Warning Labels

27. True or False: A food or drug is said to be injurious if it contains any substance that may make it harmful.

28. ANSWER
True

29. State and Local Laws
If goods are manufactured and sold only within the boundaries of a state, the federal government has no control over the goods.
For this reason, many states have enacted their own product liability laws.

30. State and Local Laws
These laws apply to intrastate sales (sales within a state).
Nearly all states and localities license and regulate establishments that sell food.

31. True or False: The federal government applies unusually high taxes on harmful products in order to raise enough money to warn consumers of its dangers.

32. ANSWER
False

33. Pre-Learning Question
Where can you go to get consumer protection assistance?

34. Consumer Protection Assistance
Many state and local governments have offices of consumer affairs to educate consumers and help protect them against fraud.

35. Consumer Protection Assistance
The federal Consumer Product Safety Commission establishes safety standards for consumer products.
For information or to report unsafe products you can call its hotline at
CPSC.

36. Better Business Bureau
The Better Business Bureau (BBB) is an example of a nongovernment agency that hears consumer complaints at the local and state levels. Its mission is to promote high ethical relationships between businesses and the public.

37. Better Business Bureau
The BBB provides services that include the following:
Provides information on a business’s past dealings
Helps resolve complaints
Provides information on charitable organizations

38. Better Business Bureau
Publishes consumer publications, videos, and Internet advisories
Alerts businesses, consumers, and law enforcement agencies about current scams and frauds
Provides Internet reliability and privacy “Trustmark” seals

39. True or False: Intrastate sales involve the buying and selling of merchandise within a state, not across state lines.

40. ANSWER
True

41. Reviewing What You Learned
Section Assessment
Reviewing What You Learned
What is the difference between product liability and strict liability?

42. Reviewing What You Learned Answer
Section Assessment
Reviewing What You Learned
Answer
Manufacturers and sellers have product liability when they place defective, unhealthy, or unsafe items on the market. They are strictly liable, without regard to fault, when they sell unreasonably dangerous products.

43. Reviewing What You Learned
Section Assessment
Reviewing What You Learned
What is the purpose of the Consumer Product Safety Act?

44. Reviewing What You Learned Answer
Section Assessment
Reviewing What You Learned
Answer
Protects consumers from unreasonable risk of injury from using consumer products.

45. Reviewing What You Learned
Section Assessment
Reviewing What You Learned
What prohibitions are contained in the Food, Drug, and Cosmetic Act?

46. Reviewing What You Learned Answer
Section Assessment
Reviewing What You Learned
Answer
It prohibits the manufacture and shipment of faulty products in interstate commerce.

47. Reviewing What You Learned
Section Assessment
Reviewing What You Learned
Where can you find consumer protection assistance?

48. Reviewing What You Learned Answer
Section Assessment
Reviewing What You Learned
Answer
From state and local consumer protection agencies, such as the Consumer Product Safety Commission and the Better Business Bureau.

49. Critical Thinking Activity Consumer Protection
Section Assessment
Critical Thinking Activity
Consumer Protection
Why do you think so many consumer protection laws are necessary?

50. Critical Thinking Activity Answer Consumer Protection
Section Assessment
Critical Thinking Activity Answer
Consumer Protection
Answers will vary. Students will probably propose that laws are necessary to protect consumers from unethical businesses and unsafe products.

51. Legal Skills in Action Production Information Labels
Section Assessment
Legal Skills in Action
Production Information Labels
Olivia has taken nonprescription allergy medication for several years. Recently, the medication was taken off the market because of an ingredient called PPA.

52. Legal Skills in Action Production Information Labels
Section Assessment
Legal Skills in Action
Production Information Labels
Now Olivia wonders if any other dangerous ingredients were in the medication that she took.

53. Legal Skills in Action Production Information Labels
Section Assessment
Legal Skills in Action
Production Information Labels
In groups of two or three, investigate and review the ingredients on the labels of some of the products you use and the food you eat at school.

54. Legal Skills in Action Production Information Labels
Section Assessment
Legal Skills in Action
Production Information Labels
You can review products such as soda, snack items from vending machines, chewing gum, and cosmetics. Make a list of the ingredients you are not familiar with.

55. Legal Skills in Action Production Information Labels
Section Assessment
Legal Skills in Action
Production Information Labels
Will you continue eating the food and using the products? Why or why not?

56. Legal Skills in Action Answer
Section Assessment
Legal Skills in Action Answer
Production Information Labels
Lists will vary but could include ingredients such as xanthan gum, stearic acid, partially hydrogenated cottonseed oil, and maltodextrin.

57. End of Section 15.2