Slide 1Slide 2Slide 3Slide 4Slide 501/01/2021 BUSA 2106 1Product Liability & Warranties01/01/2021 BUSA 2106 2Product Liability & WarrantiesWhen products are defective or don’t work as expected, Product Liability Claims OR Warranty Claims can result:•Product Liability claims usually come when the something is wrong with a product (defect) which causes some injury to the consumer•Warranty claims usually come when the product just doesn’t work the way it should (as warranted) and the consumer didn’t get what he/she expected01/01/2021 BUSA 2106 3Product LiabilityThree (3) Types of Defects in Products, which can cause injury:1. Manufacturing Defect•Occur during the manufacturing process•Involve poor materials or workmanship2. Design Defect•Product design itself is inherently dangerous/defective•Defective no matter how manufactured Product fails to satisfy ordinary consumer expectations of what constitutes a safe product •Risks of product as designed outweigh its benefits (any safer alternative designs?)3. Marketing Defect (a.k.a., Failure to Warn)•Product carries inherent, nonobvious dangers which could be mitigated through adequate warnings •Dangers are present regardless of manufacture or design01/01/2021 BUSA 2106 4Claims are based on one (or both) of the following theories:1. Negligence•Defendant was negligent in design, manufacture, or marketing of the product (had a duty to make safe products and breached), resulting in a defect•The defect causes injury•Manufacturers, distributors, and retailers can be liable•Still, can be tough to establish breach if an entire industry operates under lax standards2. Strict Liability•Irrelevant whether negligence involved in making/designing/marketing the product (avoids issues with industry custom)•If a product is defective and that defect causes injury•Manufacturers, distributors, and retailers are liable •In GA, only manufacturers can be strictly liableNOTE: In all cases, the product must be new property when first sold AND not substantially altered/modifiedProduct Liability01/01/2021 BUSA 2106 5NOTE: To sue on a product warranty claim, you must have PRIVITY of CONTRACT (you bought it from THEM) with the person/company you sue1. Express warranty•Oral or written agreement•Subject to contract rules, such as conditions precedent2. Implied warranty of merchantability•In all sales of goods, it is implied that the seller of goods (“merchant”) warrants (promises) that the goods are fit for their intended purpose, i.e., they are what seller claims them to be and will do what buyer expects•Can be expressly disclaimed or if sale is “as is" or "with all faults" 3. Implied warranty of fitness for a particular purpose•Buyer must rely upon expertise of seller to recommend particular product to be used for particular purpose•Seller must know buyer is relying upon seller’s expertise•Can also be expressly disclaimedProduct
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