US companies should look for alternative sources outside of China. If there is so much evidence that China is doing business unethically and there is enough evidence, why is business going that route and doing the same mistake and have legal issues in the long run? “Negligence that results in death or injury to those who use a company's products can be expensive, time-consuming, and damaging to a company's image”(Seaquist, 2012, p. 8.3). The business should consider doing buying its products elsewhere. After viewing the video Chinese Imports and food safety, I believe that that U.S retailer should be liable due to the fact that they are aware and knowledgeable of what they are doing. They are looking to save a buck here and there, but in the long run, it’s hurting their consumers. The business will have consequences and be liable under the tort law “In business, negligence is costly on many levels. If a product manufacturer causes death or injury of those who use the company's products, the resultant legal action will be expensive and time-consuming”(Seaquist, 2012, p. 8.3). The business will lose credibility and a bad reputation aside from fees associated with damages.
“Every member of society is charged with a duty to act with reasonable care at all times in order to avoid harming others through carelessness”(Seaquist, 2012, p. 8.3). One thing that US businesses could invest in if they want to use exports from China or other overseas countries is to invest in labeling their products the correct way and have the product regulated. Having the food being labeled and showing what types of ingredients are being used to produce the product will allow consumers to make a wise choice. It is a wise idea for a business to do their research of business that they want to do business with to see the history and if they have ever had any unethical products being exported to the US before getting in contact with that manufacturer. Investing a little extra money will bring the US business piece of mind knowing that they have done their diligence and know what type of products are on their shelves.
Seaquist, G. (2012). Business Law for Managers. [Electronic Version]. Retrieved from https://content.ashford.edu/ (Links to an external site.)
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Chinese Imports & Food Safety – PBS Newshour (Links to an external site.)
1. Consider whether the U.S. retailers that that utilize products or raw ingredients that are imported from China and are poorly regulated should be liable in tort for injuries to consumers who are harmed by those products.
After watching the Chinese Imports & Food Safety video and reading the assigned chapters from the test I am of the opinion that retailers in America should be held liable for the injuries of the consumers who are injured by the products or raw ingredients that are imported from China under strict liability theory in law. “In contrast with absolute liability, strict liability is a recently developed theory in law that holds manufacturers, wholesalers, and retailers liable for defects in the design or manufacturing of products that render such products unreasonably dangerous to the intended users” (Seaquist, 2012, section 8.2). I believe that U.S. companies owe a duty of care to their customers to ensure that the products that they are selling are safe, no matter where those products are being purchased from, and if that duty is breached then the retailer should be held liable.
2. For this part of the prompt, answer one of the following points:
-If the U.S. companies should be liable, then those companies would not be legally exempt from tort liability. Discuss the consequences of such a policy to U.S. businesses.
If U.S. companies are held liable for selling defective and dangerous products that are imported into the U.S. as a result of a lack of regulations and standards in China this would result in those companies not having exemption from tort liability. As a result, consumers would have the right to file lawsuits in the event of injury and pursue the U.S. retail company directly for their negligence in selling the defective product. This would become a huge liability exposure for companies in the U.S. who sell these products from China and would become very costly. Insurance premiums would rise to protect those companies for the new increased risk, and those companies would have to weigh out the cost vs the benefit of selling those products from China.
3. Regardless of your response to part a, assume that U.S. retailers do have legal liability for defective products. What steps could U.S. retailers and manufacturers take when using products imported from China that would minimize their liability exposure? For example, they could warn consumers about the potential, though speculative, dangers when using products comprised of poorly regulated ingredients or components. Given your strategy, what challenges would exist for U.S. businesses that implemented your strategy?
U.S. retailers can minimize their exposure of liability by demanding from their manufacturers in China to see the safety measures and protocols are being upheld to ensure the safety of the products and pressing for the manufacturer to uphold to a certain standard in order to maintain their business. This would show that the company is exercising reasonable duty of care to ensure the safety of the products that they are selling, If all the companies in the United States started to take this stand it may change the way that the competition looks in today’s market. Right now, it is all about who has the best product for the lowest price, but if more companies were emphasizing the importance of safety protocols and testing to show that the products are safe then that may take precedence over who can make the cheapest product.
U.S. retailers that implement this strategy would face the challenge of having to pay more for the product because they cannot expect to pay the lowest dollar amount and then require safety protocols and product testing to ensure quality. In the end, as the saying goes, you get what you pay for; but the company would have to likely raise their price to incorporate the added expense of ensuring the safety of the product and auditing of the testing.
Seaquist, G. (2012). Business law for managers [Electronic version]. Retrieved from https://content.ashford.edu/