Business Law

1- This famous lawsuit is definitely not one that is black and white. Facts were misconstrued and the media added an extra layer of confusion in the public eye. In this case, Liebeck was awarded nearly $3 million dollars in punitive damages but it was drastically reduced to $650K. I am not fully understanding how the judge came up with these figures (the documentary said two years of coffee revenue), and the reason behind the drastic reduction. I don’t necessary agree or disagree with the reduction but I am curious about the rationale. I do think that punitive damages should have been awarded in this case. The reason I say this is because in the end of the documentary, McDonalds did change the holding degree to 10 degrees cooler. That indicates to me that the company felt that maybe the coffee was too hot and as a result to paying the award, they did turn the temperature down. For this in case in particular, I don’t agree or disagree with McDonalds paying the punitive damages in full but only because of the media. Punitive damages are utilized to almost teach the other party a lesson. In this case, the media gave it so much attention and shed such negative light on McDonalds, that the punitive damages were almost in a way unnecessary because of all of the negative attention they received. It is unclear if the punitive damages or the media attention caused the company to make changes but either way, McDonalds did take action once the suit resolved.2- I think that punitive damages do serve as a deterrent to companies who manufacture defective products that cause injury. I think the potential of being fined for putting out defective products causes companies to be more cautious about the products they produce. If there were no repercussions for producing faulty products, companies may not perform additional safety checks or take caution when creating products. I do think that there should be a cap on punitive damages but I think it should be more of a percentage and classified into categories. In my line of work, there is a cap on attorney fees that a petitioner attorney receives and it is up to a certain percentage. That way, it is more based on the monetary award rather than a set cap. I think this ensures that the petitioner receives more than what their attorney would whereas in this case, the punitive damage was the majority of the award. Therefore, I think there should be a cap but it should be a capped percentage of the actual award rather than an arbitrary award. I think that depending on the severity of the injury should put the award into a particular category. If the injury is considered minor, maybe they are only entitled to 10-20% of the actual award in punitive damages. For maybe let’s say a more severe injury or even death, the courts could award up to 75-100% of the original award. I think it’s important to have a moving scale for potential options for punitive damage awards because each case is so different as we found in the McDonalds case. It is not just a black and white scenario but it all depends on each particular this response and write a comment based on it At least 150 words

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