Question

The power of advertising is in its persuasive influence, and this influence can take several different forms. Research and explain one example of persuasive advertising within the last year that is unfair and deceptive and that violates the law in regard to product liability. Be sure to identify and explain the law in your answer. See Section 13-2: Advertising as a Contract Basis for Product Liability in your textbook. Provide support for your response.

In relation to government enforcement of product warranty and liability claims, research the Internet or the Strayer Library for information about the latest activities by the Food and Drug Administration (FDA), Consumer Product Safety Commission (CPSC), and the National Highway Traffic Safety Administration (NHTSA). Analyze the current state of government regulation for product safety to determine whether each administrative agency is generally proactive or reactive. Provide one specific example within the last year from each agency.

Answer 1

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The power of advertising is in its persuasive influence, and this influence can take several different forms. Research and explain one example of persuasive advertising within the last year that is unfair and deceptive and that violates the law in regard to product liability. Be sure to identify and explain the law in your answer. See Section 13-2: Advertising as a Contract Basis for Product Liability in your textbook. Provide support for your response.

Ever thought why most branded eyewear is so expensive, even though the manufacturing cost seems to be a small percentage of it? Why pay $200 dollars for a pair of sunglasses where the manufacturing cost is only $10?

The answer is Luxottica. It is an Italian eyewear manufacturing and retail company that owns or is licensed to manufacture most of the eyewear (sunglasses and prescription frames) brands across the world. This includes, but is not limited to: Ray Ban (owned).

All the following designer labels are licensed to Luxottica for manufacturing:

• Giorgio Armani
• Bulgari
• Burberry
• Chanel
• Dolce and Gabbana
• Prada
• Polo Ralph Lauren
• Tiffany and Co. and many more.

But not only this, Luxottica has also runs major eyewear retail stores across different countries (USA, Canada, China, UK etc.), including:

• Sears optical
• Target optical
• Sunglass Hut International and many more…

Luxottica controls most of the manufacturing, distribution and retail of eyewear in most major markets across the world. Hence, they monopolize their control to raise the prices of eyewear to the sky. And any company that tries to compete with them is put out of business, as they stop selling their competitors’ products in their retail stores. This prevents any competition to come into the market.

I believe that this business practice is absolutely unethical. The reasons being are;

1. Stopping or preventing open competition in the market that directly deprives consumers to buy a product at a competitive price of their choice.
2. The social responsibility is compromised and questionable.

I think the company failed to make the right decision for making high profit from the business.

The consequence that I can imagine is mainly on the price hiking of glasses that the consumers will have to pay out of their pockets. Purchase power of the consumers is not considered fully in the business rather profit is the prime consideration here, which is against the ethics. Consumer’s choice is seized and they are forced to pay as they have very limited scope of negotiation. Though there are visible diversities in the market but this is basically an optical illusion!    

The competition law must be enforced by the authorities of different nations to ensure market competition and fair business.

In relation to government enforcement of product warranty and liability claims, research the Internet or the Strayer Library for information about the latest activities by the Food and Drug Administration (FDA), Consumer Product Safety Commission (CPSC), and the National Highway Traffic Safety Administration (NHTSA). Analyze the current state of government regulation for product safety to determine whether each administrative agency is generally proactive or reactive. Provide one specific example within the last year from each agency.

The U.S. Food & Drug Administration (FDA) protects public health by ensuring the safety of drugs, medical devices, cosmetics and food. They also regulate the manufacturing, marketing and distribution of tobacco products. The FDA came about in 1906, after then President T. Roosevelt signed the Food & Drug Act into law. The FDA helps make products safer for consumer use. The FDA is a proactive organization. Drugs are tested and must be submitted for FDA approval before it can be sold to consumers. Drugs go through rigorous testing and research before they can be approved. Food items are also inspected before sale. The FDA monitors all companies that sell food or drugs to ensure that they are operating within the health guidelines that are set.

The Consumer Product Safety Commission (CPSC) is responsible for protecting consumers from the risk of injury or death that may be caused by a consumer product. They ensure the safety of all types of products such as toys, children’s car seats, tools, and household chemicals. The CPSC employs what is called an Inspector General. The inspector conducts investigations, recommends different policies and reviews safety legislation. This agency is proactive as well. Products are tested before they go on the market for public use and must pass certain tests in order to be sold. This agency can also be reactive because it investigates incidents that are caused by a faulty product. The CPSC finds ways to make products safer for the public. They also issue recalls on products that have safety issues. One of the most recent recalls was the recall of a children’s swing. The issue with this product is that the plastic swing may crack and pose a fall hazard. This recall was announced today.

The National Highway Traffic Safety Administration (NHTSA) is an agency that regulates and enforces vehicle performance standards, prevent injuries due to road crashes, and enforces the rules of the road. They also license vehicle manufacturers. This agency is both proactive and reactive. It is proactive because it sets safety standards for vehicles and highways to ensure the safety of travelers. It is reactive because it analyzes traffic statistics to determine ways to make traveling more safe.

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