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Published byAnnabella Lorena Fisher Modified over 9 years ago
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CHAPTER 7 Business Torts and Product Liability
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BUSINESS TORTS AND PRODUCT LIABILITY Key Points
Identify the principal intentional business torts and available defenses Understand intentional torts Understand product liability Understand strict liability
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A CRIME IS A PUBLIC WRONG WHEN ONE BREACHES A DUTY OWED TO SOCIETY
CRIMES A CRIME IS A PUBLIC WRONG WHEN ONE BREACHES A DUTY OWED TO SOCIETY
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TORT A TORT IS A CIVIL WRONG, OTHER THAN A BREACH OF CONTRACT, FOR WHICH THE COURT WILL PROVIDE A REMEDY NORMALLY IN THE FORM OF DAMAGES
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3 GENERAL TORT CATEGORIES
Intentional Product Liability Strict Liability
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INTENTIONAL TORTS
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FOUR ELEMENTS DUTY BREACH OF DUTY CAUSATION INJURY
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An element in most torts except for:
FAULT An element in most torts except for: Products liability Strict liability
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INTENTIONAL TORTS AGAINST PERSONS
Assault
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INTENTIONAL TORTS AGAINST PERSONS
Battery
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INTENTIONAL TORTS AGAINST PERSONS
False imprisonment
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INTENTIONAL TORTS AGAINST PERSONS
Fraud
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INTENTIONAL TORTS AGAINST PERSONS
Defamation: slander libel
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INTENTIONAL TORTS AGAINST PERSONS
Invasion of privacy: Appropriation of a person’s name or likeness Intrusion Public disclosure of private facts False light
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INTENTIONAL TORTS AGAINST PERSONS
Intentional infliction of emotional distress
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INTENTIONAL TORTS AGAINST PERSONS
Personal injury
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INTENTIONAL TORTS AGAINST PERSONS
Malpractice (Medical, legal, accounting, etc.)
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INTENTIONAL TORTS AGAINST PERSONS
Wrongful death
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INTENTIONAL TORTS AGAINST PROPERTY
Trespass to real property
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INTENTIONAL TORTS AGAINST PROPERTY
Trespass to personal property
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INTENTIONAL TORTS AGAINST PROPERTY
Conversion
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INTENTIONAL TORTS AGAINST PROPERTY
Nuisance
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INTENTIONAL TORTS AGAINST PROPERTY
Injurious falsehood
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BUSINESS TORTS Patent Infringement
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Copyright infringement
BUSINESS TORTS Copyright infringement
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Trademark infringement
BUSINESS TORTS Trademark infringement
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BUSINESS TORTS Unfair competition
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INTENTIONAL TORT DEFENSES
Consent Mistake Necessity Self-defense
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PRODUCT LIABILITY
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PRODUCT LIABILITY CLAIMS
Causes of action against manufacturer, distributor and/or sellers for injury from a defective product to the person or property of purchaser, consumer and/or bystander
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POSSIBLE TORT AND/OR CONTRACT CLAIMS
Negligence Breach of warranty Strict liability
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NEGLIGENCE
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NEGLIGENCE Failure to do what a reasonable person would do or doing what a reasonable person would not do
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PLAINTIFF MUST PROVE EACH OF THE FOLLOWING ELEMENTS:
Duty Breach of duty Causation: Actual cause Proximate cause Injury
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MANUFACTURING DEFECTS
Improper manufacturing of goods gives rise to tort claim
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DESIGN DEFECTS Negligence law requires that manufacturers designing products to anticipate and avoid consumer injury Two tests: Risk/utility test: Consumer expectations test:
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INADEQUATE WARNINGS Failure to warn of a danger associated with its product creates manufacture and maybe seller liability!!!!
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INADEQUATE WARNING Issues include:
Whether the supplier knew or should have known that the product could be dangerous in a foreseeable use The feasibility of an effective warning The probable seriousness of the injury
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NEGLIGENCE DEFENSES Comparative Negligence Contributory Negligence
Assumption of Risk
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WARRANTIES AND BREACH OF WARRANTIES
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EXPRESS WARRANTIES Express warranty is when a seller of goods states a fact or makes a promise regarding the character or quality of the goods
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EXPRESS WARRANTIES Created by: Any description of the goods
Any affirmation of fact or promise Any description of the goods Any sample or model Advertisement
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Sales talk or puffing does not create an express warranty
EXPRESS WARRANTIES Sales talk or puffing does not create an express warranty
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An “expert’s” opinion may create an express warranty
EXPRESS WARRANTIES An “expert’s” opinion may create an express warranty
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DISCLAIMERS – EXPRESS WARRANTIES
May be disclaimed or modified only with great difficulty
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IMPLIED WARRANTIES An implied warranty automatically attaches to the sale of goods by operation of law
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TWO TYPES Merchantability 2. Fitness for a Particular Purpose
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DISCLAIMERS-IMPLIED WARRANTIES
May be excluded or modified as follows: Any disclaimer of merchantability must mention merchantability and, in the case of a writing, must be conspicuous Any disclaimer of fitness for a particular purpose must be by a writing and conspicuous
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STRICT LIABILITY
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RES IPSA LOQUITUR The thing speaks for itself
In rare cases, plaintiff need not prove manufacturer’s negligence Injury caused by an instrumentality under control of defendant·
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STRICT LIABILITY—PART I
Definition: One who sells any product in a defective condition, unreasonably dangerous to user or consumer, is liable for harm caused if: · The seller is engaged in the business of selling such a product and · The product is expected to and does reach user without substantial change in the condition in which it is sold
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STRICT LIABILITY—PART II
Coverage: The rule applies— Even though seller has exercised all possible care Even where the user has not bought the product from seller To all those in the distribution chain, from manufacturer through ultimate retailer
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STRICT LIABILITY—PART III
Policy: To place the burden and cost of injury on the chain of distribution (which can both insure for and spread the cost), rather than imposing the entire burden on the injured user
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Defenses: Assumption of risk Product misuse
Normally not assumption of risk
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TORT REFORM? PRO Tort costs are about 2.2% of America’s GDP
Tort costs are higher in the U.S. than in other countries Too much of tort awards get paid to the attorneys rather than the victims
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TORT REFORM? CON Lawsuits are less than 2% pf spending and product liability suits are only a fraction of that. Insurance costs don’t drop when tort damages awards are capped Only 3 % of tort cases go to trial Punitive damages are only awarded in 3.3% of tort cases
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See You in Court? Maybe Not
States have been cracking down on the types of suits that can be filed and how much can be recovered. Here’s a look at some of the restrictions.
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See You in Court? Maybe Not
States have been cracking down on the types of suits that can be filed and how much can be recovered. Here’s a look at some of the restrictions.
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Class-action restrictions
Legislatures in nine states have made it harder to combine large numbers of claimants in a single lawsuit
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Medical- malpractice maximums
Limits on damages, including pain and suffering, and similar measures have been approved by 23 states
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Punitive-damages limits
Ceilings on the amount of punitive damages have been passed in 32 states
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Barring out-of-state plaintiffs
Eight states, once meccas for out-of-state plaintiffs, now curtail suits by people with no connection to the jurisdiction
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Appeal-bond reform Nearly three dozen states have limited the size of the bond needed to appeal a verdict, removing a huge burden for companies
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Guns Some 33 states have passed laws protecting firearms makers from certain suits filed by gun victims
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Obesity/junk food Laws in 23 states keep you from suing the likes of McDonald’s for making you fat
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Drugs A number of states have made it harder to win claims against pharmaceutical companies if their products have been approved by the U.S. Food & Drug Administration
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Class-action restrictions
Legislatures in nine states have made it harder to combine large numbers of claimants in a single lawsuit
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Medical- malpractice maximums
Limits on damages, including pain and suffering, and similar measures have been approved by 23 states
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Punitive-damages limits
Ceilings on the amount of punitive damages have been passed in 32 states
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Barring out-of-state plaintiffs
Eight states, once meccas for out-of-state plaintiffs, now curtail suits by people with no connection to the jurisdiction
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Appeal-bond reform Nearly three dozen states have limited the size of the bond needed to appeal a verdict, removing a huge burden for companies
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Guns Some 33 states have passed laws protecting firearms makers from certain suits filed by gun victims
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Obesity/junk food Laws in 23 states keep you from suing the likes of McDonald’s for making you fat
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Drugs A number of states have made it harder to win claims against pharmaceutical companies if their products have been approved by the U.S. Food & Drug Administration
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