Torts: Classifications, Damages, and Intentional Conduct

• Torts are civil wrongs, not arising from a contract, for which the law provides a remedy.

Damages Available in Tort Actions

• Compensatory damages reimburse actual losses.
• Special damages compensate for quantifiable monetary losses.
• General damages compensate for non-monetary aspects like pain and suffering.
• Punitive damages punish the wrongdoer and deter similar conduct.

Tort Classifications

• Intentional torts involve deliberate actions.
• Unintentional torts involve negligence.
• Strict liability torts do not require fault.

Defenses

• Consent to the act.
• Self-defense.
• Defense of others.
• Necessity.

Intentional Conduct

• Intent to commit the act that caused the harm is required.
• A harmful motive is not required.
• Intending the act that results in harm is sufficient.
• A tortfeasor is one who commits a tort.

Assault and Battery

• Assault is an act causing reasonable fear of immediate harmful contact.
• Battery is unexcused, harmful or offensive physical contact.
• Malice is not necessary for battery.

Defenses to Assault and Battery

• Consent - permission for the act.
• Self-defense - reasonable force to protect oneself.
• Defense of others - reasonable force to protect others.
• Self-defense and defense of others are allowed in both real and apparent danger.
• Force used must be reasonably necessary.

False Imprisonment

• Physical barriers, restraints, or threats of force constitute false imprisonment.
• The restrained person must not consent to the restraint.
• Many states give businesses a defense to detain shoplifters for a reasonable time and manner, if there is probable cause.

Intentional Infliction of Emotional Distress

• Requires outrageous conduct.
• May require physical symptoms or documented emotional disturbance.

Defenses to Intentional Infliction of Emotional Distress

• Consent.
• The outrageous speech is considered normal under the circumstances.
• Speech directed at public figures.

Defamation

• Wrongfully harming a person’s good reputation.
• Libel is defamation in written form.
• Slander is defamation in oral form.

Elements of Defamation

• The defendant made a false statement of fact.
• The statement was understood as referring to the plaintiff.
• The statement was published to a third party.
• If the plaintiff is a public figure, actual malice must be proven.

Damages for Defamation

• Libel damages - proof of libel allows presumed general damages; special damages not necessary.
• Slander damages - plaintiff must prove special damages unless it is slander per se.

Slander Per Se

• False statement that a person has a loathsome disease.
• False statement that a person has committed improprieties in their profession or trade.
• False statement that a person has committed or been imprisoned for a serious crime.
• False statement that an unmarried woman is unchaste.

Defenses to Defamation

• Truth is an absolute defense.
• Privileged speech is also a defense.

Privileged Speech

• Absolute privilege in judicial proceedings.
• Absolute privilege in legislative proceedings.
• Qualified privilege made in good faith to those with legitimate interest.

Public Figures

• Public figures must prove "actual malice".
• Actual malice - made with knowledge of falsity or reckless disregard for the truth.

Invasion of the Right to Privacy

• Right to solitude & freedom from prying public eyes.

Acts that Qualify for Invasion of Privacy

• Intrusion into private affairs.
• False light - attributing untrue beliefs or actions.
• Public disclosure of private facts.
• Appropriation of identity - using someone's name or likeness for commercial purposes without permission.
• One's right to privacy includes the right to the exclusive use of his or her identity.
• Appropriation statutes vary by state.

Fraudulent Misrepresentation

• Misrepresentation of material facts with knowledge of falsity or reckless disregard for the truth.
• Intent to induce another to rely on the misrepresentation.
• Justifiable reliance by the deceived party.
• Damages suffered as a result of the reliance.
• A causal connection between the misrepresentation and the injury.
• More than mere "puffery" (seller’s talk).
• Reliance on opinion may be fraud if the person giving it has superior knowledge of the subject.
• Negligent misrepresentation is also actionable.

Abusive or Frivolous Litigation

• Filing a lawsuit without a legitimate basis for a cause of action.
• Often used as a counterclaim by defendant.

Wrongful Interference with a Contractual Relationship

• Any lawful contract can be the basis for this action.
• The defendant must know of the contract and induce the breach.

Elements of Wrongful Interference with a Contractual Relationship

• A valid contract exists.
• A third party knows about the contract.
• The third party intentionally induces a party to breach the contract.

Wrongful Interference with a Business Relationship

• Individuals cannot interfere unreasonably with another's business to gain a share of the market.
• Predatory behavior - soliciting only those customers who have shown an interest in a competitor.

Elements of Wrongful Interference with a Business Relationship

• An established business relationship exists.
• The defendant uses predatory methods to cause the relationship to end.
• Damage occurs.

Defenses to Wrongful Interference

• Bona fide competitive behavior.
• Aggressive marketing and advertising strategies.

Intentional Torts Against Property

• A wrong is committed against the individual who has legally recognized rights regarding real or personal property.
• Real property is land and things permanently attached to it.
• Personal property is movable property.

Trespass to Land

• A person, without permission, enters onto, above, or below the surface of land owned by another or causes something to enter the land, or remains on the land after being told to leave.
• No harm to the land is necessary for trespass.
• Reasonable intrusion into air space is permitted.
• An owner must implicitly or expressly establish that the person is a trespasser.
• Expressly - tell a guest to leave or post "no trespassing" signs.
• Implicitly - anyone on the property to commit an illegal act.
• Trespasser is liable for damages caused and generally cannot hold the owner liable for injuries sustained, with exceptions.
• Some jurisdictions have a "reasonable duty" rule, requiring a warning in certain circumstances.
• The "attractive nuisance" doctrine applies to young children attracted to the premises by some object.
• An owner can remove a trespasser with reasonable force without being liable for assault and battery.

Defenses to Trespass to Land

• Entering to assist someone in danger, even if that person is a trespasser.
• Entering to protect property.

Trespass to Personal Property

• Wrongfully harming or interfering with the personal property owner’s right to the exclusive possession and enjoyment of their property.
• Involves intentional meddling.
• A defense is if the meddling was warranted.

Conversion

• Any act that deprives an owner of personal property without permission or just cause, placing the property in the service of the trespasser or another person.
• It is like civil theft, but cases aren't limited to theft.
• Can include action for trespass to personal property.

Non-defenses to Conversion

• Good intentions.
• Not knowing the item bought was stolen.

Disparagement of Property

• Slander of Quality (Trade Libel): Publication of false information about another's product, alleging it is not what its seller claims.
• Actual damages must be proved to have proximately resulted from the statements about a competitor's products.
• Slander of Title: Publication denies or casts doubt on another's legal ownership of property, resulting in financial loss to the owner.
• Someone knowingly publishes an untrue statement about property with the intent of discouraging a third person from dealing with the person slandered.

Negligence (Unintentional Tort)

• Actor's conduct creates a foreseeable risk of harm.
• Actor fails to live up to a required duty of care.

Elements of Negligence

• Duty: The defendant must owe a duty of care to the injured party.
• Breach: The defendant must breach that duty.
• Causation: The defendant’s breach must cause the plaintiff’s injury.
• Damages: The plaintiff must suffer a legally recognizable injury.

Duty of Care and its Breach

• Reasonable Person Standard is used.

Duty of Landowners

• Landowners must exercise reasonable care to protect business invitees from harm.
• This includes foreseeable risks the owner knew about.
• It also includes risks the owner should have known about.
• Generally, there is no duty to warn of obvious dangers, but may still be liable for failure to maintain safe premises.
• Exception - may have duty to warn children.
• Landowner has a duty to warn licensees of known risks.
• Landowner has a duty to not willfully injure a trespasser.

Duty of Professionals

• Professionals are held to higher standard.
• Violation of duty of care leads to malpractice.

Duty of Employers

• An employer has a duty to avoid “Negligent Hiring/Retention”.

Duty to Rescue

• It is not legally required (generally) to go to the aid of a stranger.
• Exceptions - you put them in the situation.

Causation

• Courts ask two questions.

Causition Question 1

• Is there cause in fact?
• Use the "But for" test. But for the breach of duty, the injury would not have occurred.
• Burden on the party claiming harm using the preponderance of the evidence.

Causition Question 2

• Is there proximate cause?
• Is the causal connection between an act and an injury strong enough to justify imposing legal liability?
• Foreseeability is the test for proximate cause.
• If the consequences of the harm done to the victim of the harm is unforeseeable, no proximate cause.
• If no proximate cause, no legal liability.

Injury Requirement and Damages

• Must have legally recognizable injury (suffer some loss, harm, wrong, or invasion of a protected interest).
• With no injury, there is no recovery.

Special Negligence Statutes

• Dram Shop Act.
• Good Samaritan Statute.

Dram Shop Act

• A bar owner and bartender may be liable for injuries caused by a person who becomes intoxicated while drinking at the bar.
• They may also be liable for continuing to serve drinks to an intoxicated person.
• Social hosts may be liable for injuries caused by guests who became intoxicated at the host’s home.

Good Samaritan Statute

• Persons who are aided voluntarily by others cannot sue the person who aided them for negligence.
• Passed primarily to encourage health care professionals to voluntarily stop and render aid at accident without fear of liability.

Defenses to Negligence

• Assumption of the Risk.
• Superseding Intervening Force.
• Contributory Negligence.
• Comparative Negligence.

Assumption of the Risk

• If voluntarily entering into a risky situation knowing the risk involved, recovery of damages that may incur is prohibited.

Requirements of Assumption of Risk

• Knowledge of the risk.
• Voluntary assumption of the risk.
• This can be by expressed agreement or implied by actions.
• One only assumes normal risk carried by the activity.
• Risks aren't deemed assumed in emergencies.
• Some statutes protect classes of people like employees who cannot assume the risk of employer's safety violation.

Superseding Intervening Force

• An unforeseeable intervening event breaks the connection between the wrongful act and the injury to another.

Contributory Negligence

• If the Plaintiff is also negligent, then the Plaintiff has breached a duty owed to self and does not recover any money from the Defendant.
• Only a minority of states use this defense.

Comparative Negligence

• Abolishes contributory negligence.
• The majority rule is that the trier of fact (judge or jury) determines both the plaintiff and the defendant’s negligence percentage and the liability for damages is assessed accordingly.

Comparative Negligence: Pure Form

• Allows plaintiff to recover even if their negligence is greater than the defendant's.

Comparative Negligence: 50% Rule

• Plaintiff recovers only if their negligence is less than or equal to 50%.

Comparative Negligence: Texas

• Plaintiff recovers only if their negligence is less than or equal to 50%.

Strict Liability

• Liability without regard to fault.

Abnormally Dangerous Activities

• Involve a high degree of risk that cannot be completely guarded against.
• The risk involves potential serious harm.
• The activity is not commonly performed in the area.

Strict Liability: Other Applications

• Keeping wild animals.
• Keeping domestic animals (qualified).
• Quid Pro Quo Sexual Harassment.
• Strict Liability is often used in Products Liability Cases (cases based on defective products).

Products Liability

• Liability of manufacturers and sellers for harmful or defective products.

Product Liability Based on Negligence

• If a manufacturer fails to exercise "due care" to make a product safe, a person injured by the product may sue the manufacturer for negligence.
• Due Care required in the design, production processes, assembling, testing, warnings, etc.
• "Privity of Contract" is NOT required
• A plaintiff must show the Defendant’s conduct was the cause in fact and proximate cause of the injuries suffered in a 4 part negligence case.

Product Liability Based on Misrepresentation

• Fraudulent Misrepresentation (Fraud).
• Misrepresentation of material facts concerning the quality, nature or approximate use of the product is made knowingly or with reckless disregard for the truth. Injuries occur as a result of the fraud.
• The buyer/plaintiff relied on the misrepresentation.
• Examples include intentional mislabeling of products or concealment of product defects.

Strict Product Liability

• Strict Product Liability (product liability case [aka Defective Product case] based on strict liability – absolute, without regard to fault, liability).

Public Policy Justifications For Strict Product Liability

• Consumers should be protected against unsafe products.
• Manufacturers should not escape liability for defective products just because not in privity with the injured person.
• Manufacturers and sellers are in a better position to bear the costs associated with injuries caused by their products.

Requirements for Strict Product Liability

• The product must be in a defective condition when the defendant sells it.
• The defendant must normally be engaged in the business of selling (or distributing) the product.
• The product must be unreasonably dangerous to the user or consumer because of a defective condition.
• The Plaintiff must incur physical harm to self or property by use of consumption of the product.
• The defective condition must be the proximate cause of injury.
• The goods must not have been substantially changed from the time sold to the time of injury.

Unreasonably Dangerous Products

• The product was dangerous beyond the expectation of the ordinary consumer.
• A less dangerous alternative was economically feasible, but the manufacturer failed to produce it

Products Defects

• Manufacturing Defects is when a product departs from its intended design even though all possible care was exercised in the preparation and marketing of the product.
• Design Defect is when the foreseeable risk of harm posed by the product could have been reduced or avoided by the adoption of a reasonable alternative design.

Test for Design Defects

• Plaintiff must show that a reasonable alternative design was available.
• The defendant's failure to adopt the alternative design rendered the product not reasonably safe.
• A Risk-Utility Analysis is used in most states

Warning Defects

• The foreseeable risk of harm posed by the product could have been reduced or avoided by reasonable instructions or warnings.
• No duty to warn about risks that are obvious or commonly known.
• Seller must warn of Foreseeable Misuses.

Defenses to Product Liability

• Assumption of the Risk.
• Product Misuse.
• Comparative Negligence.
• Commonly Known Dangers.
• Knowledgeable User.
• Statutes of Limitations.
• Statutes of Repose.

Assumption of the Risk

• The plaintiff knew and appreciated the risk created by the product defect.
• The plaintiff voluntarily assumed the risk by express agreement or by words or conduct.

Product Misuse

• The product is used in a way not intended by the manufacturer.
• Courts have limited this defense to when the particular use is NOT foreseeable.
• If the use is reasonably foreseeable, the manufacturer must warn.

Intellectual Property

• Intellectual Property is the work of the human mind which consists of the products that result from intellectual and creative processes.
• U.S. Constitution, Article 1, Section 8 authorizes Congress to promote the Progress of Science and useful Arts, by securing for limited times to Authors and Inventors the exclusive right to their respective Writings and Discoveries.

Types of Intellectual Property

• Trademarks.
• Patents.
• Copyrights.
• Trade Secrets.
• A Licensing Agreement is a contract to receive rights to use an intellectual property and in exchange pay a royalty.

Trademarks

• A trademark is a distinctive mark, motto, device, or implement that a manufacturer stamps, prints, or otherwise affixes to the goods it produces so that they can be identified on the market and their origins made known.
• A trademark is a source indicator.

Statutory Protection of Trademarks

• Comes from the Lanham Trademark Act of 1946 and as amended in 1995 by the Federal Trademark Dilution Act.

Trademark Dilution Revision Act Requirements

• The plaintiff owns a famous mark that is distinctive.
• The defendant has begun using a mark in commerce that is diluting the famous mark.
• The similarity between the defendant’s mark and the famous mark gives rise to an association between the marks.
• The association is likely to impair the distinctiveness of the famous mark or harm its reputation.
• Marks do NOT need to be identical

Trademark Registration

• Trademarks may be registered with the state or federal government.

Federal Trademark Registration

• File an application with the U.S. Patent and Trademark Office in Washington, D.C.
• A trademark can be registered if it is currently in commerce or the applicant intends to put it into commerce within 6 months.

Trademark Infringement

• Trademark Infringement occurs whenever a trademark is copied to a substantial degree or used in its entirety by another, intentionally or unintentionally.

Distinctiveness of Mark

• A trademark must be sufficiently distinct to enable consumers to identify the manufacturer of the goods easily and to distinguish between those goods and competing products.

Strong Marks for Trademarks

• Fanciful Trademarks which include invented words.
• Arbitrary Trademarks which use common words in an uncommon way that is non-descriptive.
• Suggestive Trademarks which imply something about a product w/o directly describing the product.

Secondary Meaning

• Descriptive terms, geographic terms, and personal names are not inherently distinctive and do not receive protection under the law until they acquire a secondary meaning.
• Generic Terms like bicycle and computer do not receive protection even if they acquire a secondary meaning.

Patents

• A patent is a grant from the government that gives an inventor the right to exclude others from making, using, and selling an invention for a period of 20 years.
• A design patent lasts for a period of 14 years.
• Since 2011 the protections begin when the patent application is filed – not when the patent is issued.
• There is a "Race to the Patent office" where the first person to file the patent application receives the patent protection.
• Challenges to a patent on any grounds are prohibited for first 9 months.

What is Patentable?

• Almost anything is patentable.
• The applicant must prove the invention, discovery, process or design is novel and not obvious in light of current technology.
• The laws of nature, natural phenomena, and abstract ideas (including algorithms) are not patentable.

Patent Infringement

• If a firm makes, uses, or sells another's patented design, product, or process without the patent owner's permission, the tort of patent infringement occurs.

Remedies for Patent Infringement

• Injunctions.
• Damages for royalties and lost profits.
• Attorney’s fees.
• Treble damages.

Copyright Law

• Copyright Law provides an intangible property right granted by federal statute to the author or originator of a literary or artistic production of a specified type.
• An author has exclusive right to publish, print, or sell a product of her intellect for a certain period of time.
• The Copyright Act of 1976 & Copyright Term Extension Act of 1998 give the author or originator the exclusive rights to their works for a specific amount of time as follows:
  • Works created after 1/1/78 get copyright protection for the life of the author plus 70 years.
  • Works owned by publishing houses get copyright protection for 95 years from the date of publication or 120 years from the date of creation, whichever comes first.
  • Works by more than 1 author get copyright protection for 70 years after the death of the last surviving author.
• When the protection ends, it enters the Public Domain where copyrights expire, protected works return to the public domain whichis a “creative commons” where the law cannot control what you do with the material you find.

Copyright Registration

• Copyrights can be registered with the U.S. Copyright Office in Washington, D.C. but it is not required.
• A copyright owner no longer needs to place the symbol © or the term “Copr.” or “Copyright” on the work to have the work protected against infringement.

What is Protected Expression?

• To be protected, a work must be “fixed in a durable medium” from which it can be perceived, reproduced or communicated.
• It must also be original and fall into one of eight categories including literary works, musical works and accompanying words, dramatic works and accompanying music, pantomime or choreographic work, pictorial, graphic, or sculptural work, motion pictures and other audiovisual works, sound recordings, and Architectural Works.
• It is not possible to copyright an “idea”. Ideas embodied in a work may be freely used by others.
• What is copyrightable is the particular way in which an idea and an expression is expressed.
• If someone other than the copyright owner wishes to use the copyrighted material, a license agreement (contract) should be formed and royalties paid to the copyright owner.

Remedies For Copyright Infringement

• Actual damages plus profits received by the infringer.
• Statutory damages under the Copyright Act.
• Criminal proceedings for willful copyright infringement.

Fair Use Exception To Copyright Infringement

• Criticism.
• Commentary.
• News reporting.
• Teaching (including multiple copies for classroom use).
• Scholarship.
• Research.
• Courts use four statutory factors to determine on a case-by-case basis if the use of a work is a “fair use”.

Four Statutory Factors Used to Ascertain Fair Use

• The purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes.
• The nature of the copyrighted work.
• The amount and substantiality of the portion used in relation to the copyrighted work as a whole.
• The effect of the use upon the potential market for or value of the copyrighted work.

First Sale Doctrine

• Once a copyright owner sells or gives away a particular copy of a work, the owner no longer has the right to control the further distribution of that copy.

Trade Secrets

• Trade secret law protects some business processes and information that are not or cannot be patented, copyrighted or trademarked against appropriation by competitors.
• Examples are customer lists, plans, research and development, pricing information, marketing methods, production techniques, recipes, and generally anything that makes an individual company unique and that would have value to a competitor.
• Unlike copyright and trademark protection, protection of trade secrets extends both to ideas and to their expression.
• Trade Secret involves no registration or filing requirements.

Trade Secret: State and Federal Law

• One who discloses or uses another’s trade secret, without a privilege to do so, is liable to the other if he discovered the secret by improper means; or his disclosure or use constitutes a breach of confidence reposed in him by the other in disclosing the secret to him.
• The Uniform Trade Secrets Act of 1979 was created to eliminate the unpredictability of state common law and has been adopted by about 47 states as of 2013 (TX is the 47th).
• The Economic Espionage Act of 1996 makes theft of trade secrets a federal crime.

Trade Secrets Protection

• Businesses protect their trade secrets contractually by having all employees who use the process or information agree in their employment contracts to never divulge it.
• These are called Confidentiality Agreements.

Administrative Agencies

• Congress or state legislature usually adopts a general statute and leaves its implementation – the details – to an administrative agency.

Benefit of Administrative Law

• Benefits to society, environment, etc.

Detriment of Administrative Law

• Great costs to businesses.

Agency Creation and Powers

• Enabling Legislation is passed to create an administrative agency and specifies the agency's name, purposes, functions and powers.

Agency Classifications

• Federal Executive Agencies help the President carry out executive functions and include the cabinet departments of the executive branch.
• Independent Regulatory Agencies are agencies outside the major executive departments.

Constitutionality of Agency Powers

• Discussed the three powers of administrative agencies in ch. 1 including rule making, enforcement or investigation, and adjudication or judgement.
• The Executive controls agencies through appointment of officers and veto power.
• The Legislative controls agencies through enabling legislation allowing Congress to abolish an agency and to defund.
• Judicial Controls courts review agency actions but this is subject to the Exhaustion Doctrine.

Administrative Procedure Act (APA) of 1946

• The general statute which details the procedural requirements of all federal agencies.
• Congress can change the procedural requirements for an agency in its enabling statute, but in the absence of the specific directive from Congress, agencies follow the APA.

The Arbitrary and Capricious Test

• Courts should hold “unlawful and set aside” agency actions found to be “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”.
• Failed to provide a rational explanation for its decision.
• Changed its prior policy without justification.
• Considered legally inappropriate factors.
• Entirely failed to consider a relevant factor.
• Rendered a decision plainly contrary to the evidence.

Administrative Process

• Rulemaking Procedure.
• The APA defines a “rule” as “an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law and policy.”
• Notice-comment-rulemaking.

Notice Comment Rulemaking

• Notice of the Proposed Rulemaking occurs.
• A comment period is given.
• There is a Final Rule issued.
• Informal Agency Actions are Interpretative Rules which are specifically exempted from the APA's requirements.

Agency Enforcement

• Inspections.
• Subpoenas.
• Searches Warrants.

Subpoenas

• Subpoena ad testificandum compels a witness to testify.
• Subpoena duces tecum compels production of documents.

Adjudication

• Negotiated Settlements.
• Formal Complaints begin the process.
• The Administrative Law Judge presides.
• Hearings are conducted.
• Agency Orders are the results.

Consumer Protection

• Deceptive Advertising.
• Federal Trade Commission Act of 1914 created the FTC.

Definition of Deceptive Advertising

• When a reasonable consumer would be misled by the advertising claim.

Claims Based on Half-Truths

• Are claims based on deceptive advertising.

Bait and Switch Advertising

• When advertising a very low price for a particular item that will likely be unavailable to the consumer, who will then be encouraged to purchase a more expensive item, it is considered deceptive advertising.
• The FTC is also concerned with Online Deceptive Advertising.

FTC Actions Against Deceptive Advertising

• Formal Complaint.
• FTC Orders and Remedies.

FTC Orders and Remedies

• Cease and Desist Order directs the party to stop the deceptive advertising.
• Counter Advertising requires one to correct misinformation by advertising.
• Multiple Product Orders occur.
• Damages are assessed.
• Restitution is ordered.

False Advertising Under the Lanham Act

• States have laws that address False Advertising, one example is the Texas Deceptive Trade Practices Act (DTPA).

Telemarketing and Fax Advertising

• The Telephone Consumer Protection Act of 1991 (TCPA) prohibits telephone solicitation using automatic dialing or a prerecorded voice.
• The TCPA also prohibits ads via fax without first obtaining the recipient’s consent, and is Enforced by FCC.
• Violating TCPA can cost $11,000/day for violations.
• Private lawsuits are allowed under TCPA and a consumer can recover actual monetary loss or $500 for each violation, whichever is greater and if there is willful or knowing violation of the Act, court can triple the damages.

Telemarketing and Consumer Fraud and Abuse Prevention Act of 1994

• Before making sales pitch, telemarketer must inform the recipient that the call is a sales call and to identify the seller and the product.
• Telemarketers must inform recipients of the total cost of the goods, any restrictions in obtaining or using the goods, and whether a sale will be considered final and nonrefundable.
• Telemarketer must remove a consumer’s name from its list of potential contacts if the consumer requests.

Cooling-Off-Laws

• These laws allow consumers to cancel contracts made in their homes negotiated at their home within a set time.

FTC Mail, Internet, or Telephone Order Merchandise Rule

• This rule states that sellers must ship orders within the time promised in their advertisements, and if no time is stated, sellers must ship orders within 30 days.
• If unable to ship within the promised time, the seller must notify the consumer of the delay and offer the opportunity to cancel.

Labeling and Packaging Laws

• Labels must be accurate and use words that are easily understood by the ordinary consumer.
• Sometimes, labels must specify the raw materials used, like cotton, nylon, etc.
• Sometimes, a warning label is required.

Auto Fuel Economy Labels

• Are required by the Energy Policy and Conservation Act, and are Governed by the EPA.

Food Labeling

• The Fair Packaging and Labeling Act requires the product label to identify the product; the net quantity of the contents; serving size if the number of servings is stated; the manufacturer; the packager or distributor.
• Nutrition Labeling and Education Act of 1990 dictates the specifics.

Consumer Health & Safety

• The Federal Food, Drug & Cosmetic Act protects consumers against misbranded and adulterated foods and drugs.
• The FFDCA establishes food standards, specifies safe levels of potentially hazardous food additives, and sets classifications of food and food advertising.
• The FDA monitors and enforces the FFDCA.
• Drugs must be proven effective and safe before marketed to public.
• Food additives suspected of causing cancer are banned.
• The FDA regulates medical devices and equipment.

Consumer Product Safety Act (CPSA) of 1972

• Applies to consumer products and excludes products intended for industrial purposes and consumer products already covered by other regulatory agencies.
• The CPSA Established the Consumer Product Safety Commission (CPSC).

CPSC Authority

• The CPSC can set safety standards for consumer products.
• The CPSC can ban the manufacture/sale of any product commission believes poses an “unreasonable risk” to consumers.
• The CPSC can remove from market any product it believes to be “imminently hazardous”.
• The CPSC Requires manufacturers to immediately notify CPSC of products already sold or intended for sale if manufacturer receives info. that the product is hazardous.
• The CPSC Administers other product safety legislation.