Consumer Protection and Warranties

Consumer Protection and Warranties

ETA Products Mask and the FDA

  • ETA manufactures masks for dentists.
  • Breathing in the mask material is a concern.
  • The FDA regulates and approves the facilities that can manufacture masks.
  • The FDA sets standards for the storage and manufacturing of the masks.
  • Considerations include dangers related to the materials and manufacturing processes.

FDA Clearance Required for Manufacturers

  • To obtain FDA clearance for manufacturing respirator masks, manufacturers must adhere to several key requirements and processes.
  • Manufacturers must comply with the FDA's Quality System Regulation (QSR), which includes Good Manufacturing Practices (GMP).
  • Materials used in respirator masks must undergo biocompatibility testing to ensure they are safe for contact with skin and do not cause irritation or allergic reactions.

Burger King Case: Consumer Protection

Allegations in the Burger King Case

  • The case involves the Whopper and the Big King burgers.

Coleman et al v. Burger King Corporation

  • This is a false and misleading advertising and breach of contract class action suit.
  • The lawsuit, filed in March 2023, alleges that Burger King's signature hamburger contains 35% less meat than suggested in the company's ads.
  • The allegations are based on the company's in-store marketing and menus.
  • Similar cases have been filed against Arby’s, McDonald’s, Taco Bell, and Wendy’s.
  • The lawsuits allege that these fast-food purveyors falsely represented the size of their meat-based products.

False Advertising or Puffing?

  • Federal Trade Commission Act of 1914 empowers the FTC to prevent fraud, deception, and unfair business practices in the marketplace.
  • An action is deceptive if:
    • A reasonable consumer would be misled by the advertising.
    • The misleading misrepresentation is material.

Theory of the Burger King Case

  • The theory is based on false and misleading advertising.
  • The ads materially overstate the size of the burger.
  • The ads show the burger to be 35% larger than its actual size.
  • Burger King filed a motion to dismiss, asserting that consumers did not allege that there was less than 1/4 pound or 1/2 pound of meat, depending on the burger.

Puffery or False Advertising?

  • The discussion touches on the distinction between puffery and false advertising.

Puffery Examples

  • Shoe polish is used to make grill marks on burgers and meat to enhance visual appeal.
  • Motor oil is used on pancakes because it isn't absorbed to enhance visual appeal.

Federal Statutes: Consumer Protection

  • Federal Trade Commission Act of 1914
    • Addresses unfair and deceptive practices.
    • Established the FTC.
    • Prevents unfair methods of competition in or affecting commerce.

Federal Trade Commission Act (FTCA)

  • Under the FTCA, actions can be considered unfair without necessarily being deceptive.
    • High-pressure sales tactics.
    • Exploitative pricing.
    • Unreasonable contract terms.
    • Denial of service.
    • Unsafe products.

Food and Drug Administration

  • Federal Food, Drug, and Cosmetic Act (1938)
    • Protects consumers against food, drugs, medical devices, medical products, and cosmetics that are adulterated or misbranded.
    • Covers testing, manufacturing, labeling, packaging, shipping, distribution, and sales.

Adulterated Foods

  • Foods that contain harmful substances.
  • Prepared, packed, or stored in unsanitary conditions.
  • Contain unsafe additives.
  • Containers may render contents harmful.

Food Recall Example

  • Recent recall of carrots due to an E. coli outbreak.
    • 39 reported illnesses.
    • 15 hospitalizations.
    • 1 death.

Federal Statutes: Consumer Protection

  • Consumer Product Safety Commission Act
    • Conducts research on the safety of consumer products.
    • Sets safety standards.
    • Implements bans on hazardous products.
    • Requires reporting of risks of injury or death.

Warranties

  • Assurances by the seller about the quality and features of the goods being sold.
  • Breach of warranty claims can arise if these assurances are not met.

Express Warranties

  • Explicit factual claims regarding:
    • Quality, safety, or functionality.
    • Goods conform to affirmation or promise.
    • Goods conform to description.
    • Any description of the goods (that is made part of the basis of the bargain) creates an express warranty.
    • Goods conform to sample or model.

Implied Warranties

  • Implied warranty of Merchantability
    • Product will function as expected.
  • Implied warranty of fitness for a particular purpose
    • Applies when the seller has reason to know of a particular purpose for which the goods will be used.

Buzzkill: Current Energy Drink Litigation

  • Misleading advertising, such as 5-Hour Energy's “No crash” claim.
  • Strict liability for design defect and failure to warn.
  • Negligent design.
  • Breach of implied warranties. Examples include design defects, failure to warn consumers and misleading advertising.