intro to bus law and ethics

Assignment 6.1 - More Hot Coffee

• For this assignment, we revisit the Case of Stella Liebeck vs. McDonald's Corporation that we discussed in Week 3. The jury considered whether McDonald's acted improperly in selling 180-degree (or hotter) coffee that was significantly hotter than a consumer would expect from common experience. Stella Liebeck spilled her McDonald's coffee in her lap and incurred third-degree burns, received skin grafts, and spent seven days in the hospital. We learned that McDonald's cost-benefit defense backfired and that, despite all the ridicule, Stella's lawsuit was not frivolous.
• Let's look at what the jury thought about the merits of Stella's claims: Testimony at trial showed that before the lawsuit, McDonald's had received over 700 complaints about burns, some of them third-degree, suffered by customers who spilled coffee on themselves. A McDonald's executive testified that McDonald's knew of the risk of burns caused by its hotter-than-average coffee and knew that most customers did not realize the specific risk posed by coffee at those temperatures, but nevertheless did not intend to warn customers of the risk. The suit was not about a mere failure to warn that coffee is hot; it was about failure to warn of the danger created by serving materially hotter-than-normal coffee to customers who knew they were buying something hot.
• The McDonald's coffee lawsuit demonstrates the many factors that can figure into resolution of a personal injury claim, from the initial request for payment of medical bills (a negotiation) to a jury verdict and ultimate resolution by settlement. It is also an example of the many theories of liability a plaintiff may rely on in pursuing her claim. Mrs. Liebeck claimed that the coffee as served was excessively hot and McDonald's was liable under the theory of strict liability. She also alleged an absence of care and foreseeability of harm under a negligence theory; gross negligence; willful and wanton disregard of her rights, safety, and welfare; and for the marketing defect of no warning, or in the alternative, insufficient warning, because McDonald's Corporation and McDonald's Restaurants P.T.S., Inc. fully knew of and were aware of innumerable burn cases caused by the fault, or in the alternative, negligence of their operations in the manufacture, sale, and marketing of extremely hot coffee. She also made claims under implied warranties of merchantability and fitness for a particular purpose, arising under the Uniform Commercial Code.
• Among other defenses, McDonald's claimed Mrs. Liebeck's injuries were a result of her own negligence.
• The jury found for Mrs. Liebeck on her claims of product defect, breach of implied warranty of merchantability, and breach of the implied warranty of fitness for a particular purpose. The jury also found that she was twenty percent at fault.
• After you have read the above summary, readHot Coffeeand review Chapter 20 of the textbook on Products Liability.
• Based on this information, answer the following questions. When you answer these questions, first consider the definition of each legal claim and fit the relevant facts into that claim. Your paper should be double-spaced, be in Times New Roman 12-point font, and include APA-formatted citations and references.
• What was the basis of the jury's verdict of product defect?
• What was the basis of the jury's verdict of breach of implied warranty of merchantability?
• What was the basis of the jury's verdict of breach of implied warranty of fitness for a particular purpose?
• What legal principle did the jury apply when apportioning liability between McDonald's and Mrs. Liebeck?
• How did the judge characterize McDonald's conduct to support the award of punitive damages to Mrs. Liebeck?