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Chapter 11

STUDY
PLAY
Express warranty
contractual promise about nature or potential of product that gives right of recovery if product falls short of a promise that was a basis of the bargain
Bait and Switch
using cheaper, unavailable product to lure customers to store with a more expensive one then substituted or offered instead
Federal Trade Commission
federal agency responsible for regulating deceptive ads
Wheeler-LEa Act
federal law that allows FTC to regulate "unfair and deceptive acts or practices"
Celebrity endorsement
FTC area of regulation wherein products are touted by easily recognized public figures
Consent decree
voluntary settlement (document) of FTC complaint
Implied warranty of merchantability
warranty of average quality, purity, and adequate packaging given in every sale by a merchant
Implied warranty of fitness for a particular purpose
warranty given in circumstances in which the buyer relies on the seller's expertise and acts to purchase according to that advice
Disclaimer
act of negating warranty coverage
Privity
direct contractual relationship between parties
Strict Liability
standard of liability that requires compensation for an injury regardless of fault or prior knowledge
Restatement ( Second) S 402 A
American Law Institute's standard for imposing strict liability for defective products
Negligence
standard of liability that requires compensation for an injury only if the party responsible knew or should have known of its potential to cause such injury
Punitive Damages
damages beyond compensation for knowledge that conduct was wrongful
Misuse
product liability defense for plaintiff using a product incorrectly
Contributory negligence
conduct by plaintiff that contributed to plaintiffs injury; serves as a bar to recovery
Comparative negligence
negligent conduct by plaintiff serves as a partial defense by reducing liability by percentage of fault
Assumption of Risk
defense to negligence available when plaintiff is knew of risk and engaged in risky conduct anyway.
Consumer Product Safety Commission
federal agency that regulates product safety and has recall power
Uniform Product Liability Act
proposed federal statute that would limit product liability suits and recovery
5 ways to claim Product Liability
1)Express Warranty
2) Implied warranty of merchantability
3)Implied warranty of fitness for a particular purpose
TORTS
4)Negligence
5) Strict Liability
Defenses for Strict Liability
1)Assumption of Risk
2)Contributory Negligence
3)Comparative negligence
4)Misuse (can be found in any of the above 3)
Castro vs. QVC Network Inc. ( A turkey of a Pan: Liability on Thanksgiving Day
Case 11.1 the issue of product liability is one of representations via ad statements.
Does Listerine Prevent Colds? Warner-Lambert CO. Vs. FTC
Case11.2 Corrective advertising requires a seller to correct the unsubstantiated claims made in previous ads.
Case 11.4 Mitchell vs. TGI Friday's Clamming Up Because of Shell-Shock
Case about reasonable expectation, who ever eats oyster can reasonably anticipate and guard against eating such a piece of shell.
Greif vs. Anheuser-Busch Companies, Inc. ( is Beer Inherently Dangerous?) Case 11.5
deals with a related issue of whether beer producers are liable for accidents caused by those who are drunk from imbibing the product.