Tag: legal

Samsung has done the right thing by recalling millions of its smartphones. According to numerous reports, some batteries are catching on fire while charging. However, with the new iPhone 7 being unveiled and promoted this week, the timing for Samsung couldn’t be worse.

Samsung is reporting a problem on the average of 24 devices per every million sold. That may not sound like many but in only takes one defective battery and device to start a fire that could bring down a plane, burn down an apartment building and take lives. The problem is so real that Verizon, AT&T, Sprint, and T-Mobile have suspended sales.

I applaud Samsung for reporting it had a problem with some of its batteries and for halting sales in 10 countries. Replacements for 2.5 million Galaxy Notes 7s will be made for free. It’s doing the right thing.

The Legal Problems

The problem with the Samsung Galaxy Note 7 defective battery issue is three-fold. First, people can get hurt, and property can be damaged and lost. Second, Samsung is going to take an enormous financial hit, and in light of the new iPhone 7 being rolled out, a significant market loss because of the problem. Third, Samsung is going to be held legally responsible for harm and damages caused to people and their property.

Again, taking all of these big issues into consideration, I’m glad Samsung stepped up and did the right thing by ordering the recall. Doing the right thing in today’s business world is not always easy, but it is always necessary.

Product Liability

I share these thoughts because, under product liability law, a manufacturer or seller like Samsung can be held liable for designing, manufacturing and selling a defective and dangerous product to the consumer. This was a big deal for the company to come forward.

Over the past 30 years of trying cases (yes, I’m a lawyer), I’ve seen much bigger and more dangerous defects that have caused global deaths hidden by manufactures through confidential settlement agreements and to this day, never disclosed to the general public. I think the new level of transparency the digital platforms bring 24/7 now result in companies, more and more, doing the right thing when mistakes are made.

So what is product liability? Well, defects and dangers in a product that a consumer is either unaware of or, are completely unexpected, will usually create liability. I think we can all agree that the phones should not catch fire during charging, and so the Samsung Galaxy Note 7 clearly falls into a product liability category.

What most people are not aware of is that normally, a product liability claim is based on state laws. Legal theories designed to keep consumers safe and hold manufactures and others in the supply chain responsible including negligence, strict liability, or breach of warranty. Any party in the chain of distribution such as the manufacturer, third party assembly providers, wholesaler and retailers (Verizon, AT&T, Sprint, and T-Mobile) may all be potentially liable for the Samsung Galaxy Note 7 problems.

Different types of defects include design, manufacturing, and marketing mistakes. Depending on state laws, a legal doctrine, which I’m a big fan of and known as “res ipsa loquitur” (the thing speaks for itself) shifts the burden of proof to the defendant. What this means is that the injured plaintiff is not required to prove how the defendant is negligent. Instead, the defendant is required to prove it was not negligent. This is a powerful doctrine in our court system. I believe the res ipsa loquitur doctrine applies in the Samsung Galaxy Note 7 case.

Conclusion

With new technology and comes risks and setbacks. I’ve been flying RC plains for years, and we charge our lithium polymer (LiPo) batteries in fireproof bags. While I’m aware of the dangers of charging these new high powered batteries, most consumers are not. And that’s where we all have a problem.

I’m all for new tech and encouraging companies to take risks and improve products. Along the same lines, I’m also for people and companies accepting responsibility when they do something wrong. In this case, I’m glad Samsung stepped up and did the right thing by recalling its Samsung Galaxy Note 7 smartphones. It was the right thing to do.

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CNN video re Samsung Galaxy Note 7 with pictures