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Product Liability Product Liability Section 15.2Section 15.2
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
What You’ll Learn
How to differentiate between product How to differentiate between product liability and strict liability (p. 327)liability and strict liability (p. 327)
How to describe the purpose of the How to describe the purpose of the Consumer Product Safety Act (p. 329)Consumer Product Safety Act (p. 329)
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
What You’ll Learn
How to identify the prohibitions contained How to identify the prohibitions contained in the Food, Drug, and Cosmetic Act in the Food, Drug, and Cosmetic Act (p. 329)(p. 329)
How to determine where to get consumer How to determine where to get consumer protection assistance (p. 330)protection assistance (p. 330)
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Why It’s Important
Learning about product liability law will help Learning about product liability law will help you take effective action if you or a family you take effective action if you or a family member suffers injury from faulty products.member suffers injury from faulty products.
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Legal Terms
product liability (p. 327)product liability (p. 327)strict liability (p. 327)strict liability (p. 327)adulterated (p. 329)adulterated (p. 329)intrastate sales (p. 330)intrastate sales (p. 330)
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
What is Product Liability? Strict Liability
Section OutlineSection Outline
Federal and State Consumer Protection Laws
Consumer Product Safety ActFood, Drug, and Cosmetic ActState and Local Laws
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Consumer Protection Assistance Section OutlineSection Outline
Better Business Bureau
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Pre-Learning Question Pre-Learning Question
What do you think product liability is?
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Under Under product liability product liability law, someone law, someone who is injured from a product’s unsafe who is injured from a product’s unsafe or defective condition may recover or defective condition may recover damages. Manufacturers, sellers, and damages. Manufacturers, sellers, and suppliers of goods can all be held suppliers of goods can all be held responsible.responsible.
What Is Product Liability? What Is Product Liability?
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
You do not have to prove a negligent You do not have to prove a negligent act on the part of the manufacturer or act on the part of the manufacturer or seller if you are hurt using a defective seller if you are hurt using a defective product. product.
Strict Liability Strict Liability
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Strict liabilityStrict liability makes manufacturers makes manufacturers or suppliers responsible for selling or suppliers responsible for selling goods that are unreasonably goods that are unreasonably dangerous. dangerous.
Strict Liability Strict Liability
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
People who are injured or who suffer People who are injured or who suffer property damage from a defective property damage from a defective product may recover from the product may recover from the manufacturer or seller if they can manufacturer or seller if they can prove all of the following:prove all of the following:
Strict Liability Strict Liability
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
The manufacturer or seller was The manufacturer or seller was engaged in the business of selling engaged in the business of selling the product.the product.The product was unreasonably The product was unreasonably dangerous to the user or consumer.dangerous to the user or consumer.
Strict Liability Strict Liability
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
The defective condition was the The defective condition was the cause of the injury or damage.cause of the injury or damage.The defective condition existed The defective condition existed when the product left the hands of when the product left the hands of the manufacturer or seller.the manufacturer or seller.
Strict Liability Strict Liability
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
The consumer suffered physical The consumer suffered physical harm or property damage as a harm or property damage as a result of using the product.result of using the product.
Strict Liability Strict Liability
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Pre-Learning Question Pre-Learning Question
What are some federal and state consumer protection laws?
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Both the federal and state Both the federal and state governments pass laws to protect governments pass laws to protect consumers in the marketplace. consumers in the marketplace.
Federal and State Consumer Federal and State Consumer Protection Laws Protection Laws
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Two federal laws are the:Two federal laws are the:
Federal and State Consumer Federal and State Consumer Protection Laws Protection Laws
Consumer Product Safety ActConsumer Product Safety ActFood, Drug, and Cosmetic Act Food, Drug, and Cosmetic Act
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
This law protects you from This law protects you from unreasonable risk of injury while using unreasonable risk of injury while using consumer products that are sold in consumer products that are sold in interstate commerce. interstate commerce.
Consumer Product Safety Act Consumer Product Safety Act
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Defects in products are divided into Defects in products are divided into three categories:three categories:
Consumer Product Safety Act Consumer Product Safety Act
1.1. Manufacturing defectsManufacturing defects2.2. Poor designPoor design3.3. Inadequate instructions and Inadequate instructions and
warnings about the safe use of the warnings about the safe use of the productproduct
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
This law prohibits the manufacture This law prohibits the manufacture and shipment of faulty products in and shipment of faulty products in interstate commerce. interstate commerce. Faulty products include any food, Faulty products include any food, drug, cosmetic, or health-related drug, cosmetic, or health-related device that is injurious, adulterated, or device that is injurious, adulterated, or misbranded.misbranded.
Food, Drug, and Cosmetic Act Food, Drug, and Cosmetic Act
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
A food or drug is said to be injurious if A food or drug is said to be injurious if it contains any substance that may it contains any substance that may make it harmful to health.make it harmful to health.
Food, Drug, and Cosmetic Act Food, Drug, and Cosmetic Act
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
An An adulteratedadulterated food or drug is one food or drug is one that contains any substance that will that contains any substance that will reduce its quality or strength below reduce its quality or strength below minimum standards.minimum standards.
Food, Drug, and Cosmetic Act Food, Drug, and Cosmetic Act
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
A food or drug is misbranded if its A food or drug is misbranded if its labeling or packaging is false or labeling or packaging is false or misleading.misleading.
Food, Drug, and Cosmetic Act Food, Drug, and Cosmetic Act
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
The government uses other methods The government uses other methods to discourage the sale of goods to discourage the sale of goods considered harmful to the public considered harmful to the public health. They include:health. They include:
Food, Drug, and Cosmetic Act Food, Drug, and Cosmetic Act
Unusually high taxesUnusually high taxesLabeling and packagingLabeling and packagingOutright prohibition Outright prohibition
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
15.215.2
Warning Labels Warning Labels
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
True or False: A food or drug is said to be injurious if it contains any substance that may make it harmful.
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
ANSWERANSWER
True
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
If goods are manufactured and sold If goods are manufactured and sold only within the boundaries of a state, only within the boundaries of a state, the federal government has no control the federal government has no control over the goods. over the goods. For this reason, many states have For this reason, many states have enacted their own product liability enacted their own product liability laws.laws.
State and Local Laws State and Local Laws
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
These laws apply to These laws apply to intrastate salesintrastate sales (sales within a state). (sales within a state).
Nearly all states and localities license Nearly all states and localities license and regulate establishments that sell and regulate establishments that sell food.food.
State and Local Laws State and Local Laws
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
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.
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
ANSWERANSWER
False
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Pre-Learning Question Pre-Learning Question
Where can you go to get consumer protection assistance?
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Many state and local governments Many state and local governments have offices of consumer affairs to have offices of consumer affairs to educate consumers and help protect educate consumers and help protect them against fraud.them against fraud.
Consumer ProtectionConsumer ProtectionAssistanceAssistance
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
The federal Consumer Product Safety The federal Consumer Product Safety Commission establishes safety Commission establishes safety standards for consumer products. standards for consumer products. For information or to report unsafe For information or to report unsafe products you can call its hotline at products you can call its hotline at 1-800-638-CPSC.1-800-638-CPSC.
Consumer ProtectionConsumer ProtectionAssistanceAssistance
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
The Better Business Bureau (BBB) is The Better Business Bureau (BBB) is an example of a nongovernment an example of a nongovernment agency that hears consumer agency that hears consumer complaints at the local and state complaints at the local and state levels. Its mission is to promote high levels. Its mission is to promote high ethical relationships between ethical relationships between businesses and the public.businesses and the public.
Better Business Bureau Better Business Bureau
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
The BBB provides services that The BBB provides services that include the following:include the following:
Better Business Bureau Better Business Bureau
Provides information on a Provides information on a business’s past dealingsbusiness’s past dealingsHelps resolve complaintsHelps resolve complaintsProvides information on charitable Provides information on charitable organizationsorganizations
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Publishes consumer publications, Publishes consumer publications, videos, and Internet advisoriesvideos, and Internet advisoriesAlerts businesses, consumers, and Alerts businesses, consumers, and law enforcement agencies about law enforcement agencies about current scams and fraudscurrent scams and fraudsProvides Internet reliability and Provides Internet reliability and privacy “Trustmark” sealsprivacy “Trustmark” seals
Better Business Bureau Better Business Bureau
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
True or False: Intrastate sales involve the buying and selling of merchandise within a state, not across state lines.
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
ANSWERANSWER
True
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Reviewing What You Learned
1. What is the difference between product liability and strict liability?
Section 15.2 Assessment
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Reviewing What You Learned
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.
Section 15.2 Assessment
Answer
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Reviewing What You Learned
2. What is the purpose of the Consumer Product Safety Act?
Section 15.2 Assessment
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Reviewing What You Learned
Protects consumers from unreasonable risk of injury from using consumer products.
Section 15.2 Assessment
Answer
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Reviewing What You Learned
3. What prohibitions are contained in the Food, Drug, and Cosmetic Act?
Section 15.2 Assessment
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Reviewing What You Learned
It prohibits the manufacture and shipment of faulty products in interstate commerce.
Section 15.2 Assessment
Answer
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Reviewing What You Learned
4. Where can you find consumer protection assistance?
Section 15.2 Assessment
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Reviewing What You Learned
From state and local consumer protection agencies, such as the Consumer Product Safety Commission and the Better Business Bureau.
Section 15.2 Assessment
Answer
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Section 15.2 Assessment
Critical Thinking ActivityConsumer Protection Why do you think so many consumer protection laws are necessary?
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Section 15.2 Assessment
Critical Thinking Activity AnswerConsumer Protection Answers will vary. Students will probably propose that laws are necessary to protect consumers from unethical businesses and unsafe products.
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Section 15.2 Assessment
Legal Skills in ActionProduction 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.
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Section 15.2 Assessment
Legal Skills in ActionProduction Information Labels Now Olivia wonders if any other dangerous ingredients were in the medication that she took.
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Section 15.2 Assessment
Legal Skills in ActionProduction 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.
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Section 15.2 Assessment
Legal Skills in ActionProduction 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.
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Section 15.2 Assessment
Legal Skills in ActionProduction Information Labels Will you continue eating the food and using the products? Why or why not?
Understanding Business and Personal Law
Product Liability Product Liability Section 15.2Section 15.2
Consumer Protection and Product Liability
Section 15.2 Assessment
Legal Skills in Action AnswerProduction Information Labels Lists will vary but could include ingredients such as xanthan gum, stearic acid, partially hydrogenated cottonseed oil, and maltodextrin.
Product Liability Product Liability End of Section 15.2End of Section 15.2
