Group1_Dualplex360_03DEC19.docx - Name name name name TO...

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Name, name, name, name TO: Janet Yoon, CEO, Colossal Corporation FROM: Group 1 RE: Dualplex 360 Case DATE: December 3, 2019 FACTS New Brand Design (NBD) is a subsidiary of Colossal and incorporated in Delaware. NBD de - signs and manufactures a popular laptop, Dualplex 360. Before the product came to market, the R&D team was aware of a design defect, is that the battery would overheat and ignite if plugged too long to a power source. Instead of fixing the design, the company decided to accept the potential cost of lawsuits and included a disclaimer in the manual stating: "DO NOT LEAVE THE DUALPLEX 360 PLUGGED into A POWER SOURCE AFTER THE BATTERY IS FULLY CHARGED. SELLER EXPLICITLY DIS - CLAIMS ALL WARRANTIES. SELLER MAKES NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE. NOR IS THERE ANY OTHER EXPRESS OR IMPLIED WAR - RANTY." Many consumers did not read the manual and complained about the overheating issue. Further, it is foreseeable and reasonable that more injuries and damages will result in the continued sale and use of the product. ISSUE Will NBD be held liable for the overheating laptops, resulting in injuries and property damages? DISCUSSION Product liability is derived from tort law (Torts §402A). Products liability refers to the liability of any or all entity involved in the chain of manufacture of any product for damage caused by that product. This chain includes the manufacturer, distributor, and retailer. Products containing inherent defects that cause harm to a consumer (or someone to whom the product was loaned, gifted, etc.) of the product would be the subjects of products liability suits. This situation also deals heavily with the concepts of express warranties, as well as implied warranties for both fitness and merchantability. All three of these areas are also covered within the 1 Dualplex 360 Case
Name, name, name, name Uniform Commercial Code (UCC) and used to protect both manufacturers and their customers from harm. Express warranties are an affirmation that the product will perform in a specific way. These are created when (1) an affirmation of a fact or promise relating to the goods or (2) a description of the goods, or (3) a sample model are provided as a basis for the act of the sale (Mayer, Warner, Siedel & Lieberman, 2019). An express warranty is essentially, an act of the producer stating that the goods will operate and abide in the way they have been promised. Express warranties are based on fact and cannot be litigated against for minor over exaggerations that the seller makes. These express warranties are strictly over those items or services that parties have bargained over. An implied warranty is one that is created by law. There are two separate features of implied warranties: one of fitness and one of merchantability. The warranty of fitness with a specific determination that is implied by law under the UCC states that at any time the seller should have reason to believe or know the purpose for which the goods are being sold and that the buyer is relying on the sellers' judgment.

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