In: Operations Management
Eighty-one-year-old Stella Liebeck was a passenger in a parked
car, when she accidentally spilled scalding-hot McDonald's coffee
on herself. (McDonald's allegedly kept its coffee at 180 degrees,
40 degrees hotter than most people serve coffee, to maintain peak
flavor). The spill caused second and third degree burns that
required skin graphs and left scars.
When McDonald's offered Liebeck $800 of the $2000 medical expenses
she had asked for, Liebeck sued. After hearing that there had been
700 complaints about scalding coffee, the jury found for Stella and
awarded her $160,000 compensatory damages and another $2.7 million
in punitive. The latter were reduced on appeal to $480,000.
How might you use the above scenario to argue for/against tort
reform and what do you think should happen if the case were
appealed?
Phil Parent purchased a new car from Major Car Company. Two
weeks later, he was in a serious car accident when a four-wheel
drive drove into the side of his car while he was driving his
four-year-old daughter home from school. The driver-side airbag did
not open up, and Phil was thrown through the windshield - causing
the car to spin around and hit a tree. At that point, the air bag
on the passenger side, where his daughter was sitting, opened --
injuring the young girl.
The driver who caused the accident was uninsured and has no money,
and little chance of ever having any. Parent and his daughter have
both suffered serious injuries. Parent was out of work for six
months and lost his job -- his daugher nearly died. Expert
testimony established that airbags cannot normally be expected to
open when a car is struck from the side. There has been extensive
publicity about the risk to small children seated in the front
passenger seat.