A well-known pharmaceutical company, Robins & Robins, is working through a public scandal. Three popular medications which they sell over-the-counter have been determined to be tainted with small particles of plastic explosive. It has not yet been determined where the plastic explosives came from, but over $8 million in inventory is impacted. The inventory is located throughout the Western United States, and it is possible that it has also made its way into parts of Canada. A recall occurs but it is mostly unsuccessful.
Last fall, the FDA had promulgated an administrative rule which stated that all pharmaceutical companies which sold over-the-counter medications must incorporate a special tracking bar code (i.e. UPC bars) on all packaging, to ensure that recalls could be done with very little trouble. This bar code would have cost about $.35 (cents) per package, which would have cost the company nearly $3 million on this batch of inventory.
Robins & Robins lobbied hard against this rule, and managed to get it stopped in the public comments period. They utilized multiple arguments, including the cost (which would be passed on to consumers). They also raised "privacy" concerns, which they discussed simply to get public interest groups upset. (One of the drugs impacted is used for assisting with alcoholism treatment - specifically for withdrawal symptoms and many alcoholics were afraid their use of the drug could be tracked back to them.) Robins & Robins argued that people would be concerned about purchasing the medication with a tracking mechanism included with the packaging and managed to get enough public interest groups against the rule. The FDA decided not to impose the rule.
Using the above fact pattern, answer the following three questions:
1. TCO C. Robins & Robins immediately issued a massive recall for the tainted medication, upon learning of the situation. Despite the recall, 1400 children and 350 adults have been hospitalized after becoming very ill after taking the tainted medication. Each of them had failed to note the recall after having already purchased the medication. It is quickly determined that they will need liver transplants and many of them are on a waiting list. During the wait, to date, 12 children have died. Their families are considering suing for 402A and negligence, both. The attorneys stated that but for the lobbying efforts, the recall process would have been automated and the people would not have gotten sick or died.
You are an employee with the FDA. You are drafting a memo to your boss analyzing the FDA's liability and explaining why the FDA did the right thing in deciding not to pass the original tracking bar (UPC) rule. You are specifically being told to respond to the issue of the deaths, and illnesses. What would you write? Include (and explain fully) any defenses you feel that the FDA could use against any negligence or public relation cases. Explain what liability (if any) could the FDA have to the victims and their families© BrainMass Inc. brainmass.com October 17, 2018, 1:44 am ad1c9bdddf
TO; Mr. Woods, Chief FDA
FROM: Hansen, Employee FDA
DATE: October 24, 2010
SUBJECT: Robins and Robins Case.
The Robins and Robins case has led to several activist groups calling for FDA's liability for the death of 12 children. They point to FDA's fault and negligence in not passing the original tracking bar rule. It is contended that FDA does not have any liability to the victims of Robins and Robins medicine poisoning.
Three over the counter medicines being sold by Robins and Robins have been tainted with plastic explosives. This contamination has led to 1400 ...
This solution gives you a detailed discussion on Business Law Case 1
Business Law Discussion Questions
1. Bob is at the Boston Biceps Bodybuilding Club riding an exercise bike. Bob wants to change the station on the television which is mounted high on a nearby wall. He reaches for the remote control device, and finds that another member has accidentally taken the remote control device and left behind a cellular phone. Bob drags the exercise bike over to the television. He stands on the seat of the exercise bike in order to reach the television, but the seat post breaks and Bob falls to the floor. Bob is not injured, but cannot control his temper. He puts his 180 pounds of all muscle/no fat into destroying the exercise bike. He throws it across the room against the wall, breaking it into several pieces. The handlebars land on the running track. Bob finds another exercise bike and continues his workout. Another patron, Randy, trips over the handlebars while running on the track about 30 minutes later. Randy sues both Bob and the Club for negligence. Discuss separately the case against each defendant, and the potential for a case against the bike manufacturer.
2. Joanne is a nurse who needed a job and she knew the local elementary school needed to fill the vacant school nurse position. She contacted the school district president who was authorized to fill the position and offered to be the school nurse for weekly compensation of $1,000 from September to June. The president agreed to consider the offer and subsequently responded to Joanne in writing stating that he agreed to hire her as school nurse for the compensation of $200 per day. Discuss in detail whether there is a valid contract between Joanne and the school.
3. Hank works in the accounting department at a large retailing operation. Hank was having lunch with one of the clerks who works under him and was discussing ways to prevent embezzlement. Soon Hank was discussing how he and the clerk could embezzle funds rather than how they could prevent embezzlement. Hank and the clerk decided they would use a particular scheme that Hank had read about recently. Several weeks later a computer vendor was visiting with Hank trying to sell Hank's company a new computer system. The vendor offered Hank a $5,000 bribe to get the company to buy the system. Hank accepted the bribe and received $5,000 in cash from the vendor. Hank then ran several test transactions with the vendor's system to see if his embezzlement scheme that he had discussed with the clerk would be detected on the vendor's new computer system. Hank could not tell from this test run whether his embezzlement scheme would work. For comparison, Hank then tried the same scheme on the current system at his company, but was unable to transfer any funds to his own account. Discuss the criminal liability at this point of Hank, the accounting clerk, and the corporation that Hank works for.
4. An American corporation contracted to have athletic footwear manufactured by a foreign company overseas. The American company later was horrified to learn that the foreign company used slave labor to manufacture the shoes and refused to honor the contract. Slave labor clearly violates American law but is legal in the foreign country. The contract in question contained an arbitration clause requiring an arbitration panel made up of members from outside the U.S. to meet and decide in a neutral, third-party country, and a choice of law clause designating the law of the foreign company's location. In what forum would the matter be heard, what law applied, and what is the likely outcome if the foreign company claims breach of contract?
5. Martha is the coach of the female basketball team, and Bobby is the coach of the male basketball team at State University. Both Martha and Bobby have comparable knowledge of basketball, both have comparable skills, both work comparable hours and both have comparable win-loss records. The male team is a revenue generating sport, producing about $5 million annually. The female team does not produce revenues. Martha is paid $30,000 per year for her job but Bobby is paid $100,000 per year for his. Martha sued State University for a violation of the Equal Pay Act. Discuss the arguments on both sides of this case.
6. Nan, Fran, and Ann form a partnership, under a written agreement each signs, to buy, renovate, and resell old houses in an area near a major university. The neighborhood in which they plan to focus their activities is quite rundown, but they and others believe it will rapidly improve once a few properties in the area are renovated. The partnership agreement says that they plan to be in this venture "at least five years, or until they can recover their original investment plus a good profit." Each of the three partners puts up $50,000 in cash. One strategy of the partnership is to avoid bank financing and its associated fees, thus the partners plan to use the proceeds of sale on the first house to invest in a second, and so forth. They spend $90,000 to purchase their first property, on which they spend an additional $40,000 in renovation, and then sell for $160,000. They purchase the second property for $100,000 and have begun renovation that is expected to cost $35,000 when Ann suddenly attempts to withdraw from the partnership. Can Ann withdraw from the partnership? What other legal issues are present in this situation? It has been a year and a half since the partnership was formed.
7. Sue went away for Spring break and when she returned home, someone had built and in-ground pool in her backyard. Sue had never spoken to anyone about a pool. Later, it is discovered that the pool was to go in the neighbor's yard. Sue gets a bill from the pool company for the value of the pool. She refuses to pay. The pool company sues. Discuss the grounds on which the pool company might recover. Would it make any difference if Sue had been home during Spring break, noticed the error, and failed to inform the pool company?
8. Abe is an associate (employee) with that famous Denver law firm, Dewey, Cheatem & Howe. One Thursday Abe and another associate, Gabe, must go to western Colorado for a client's deposition. The deposition is unexpectedly over in midmorning and they start driving back to Denver. As they approach Vail, Gabe reminds Abe that the partners are in Aspen for two days and wouldn't it be nice to be a partner. Abe says, "If they're in Aspen, that means they're not in the office in Denver. I hear the slopes calling for a half day of skiing." They pull off I-70 and are skiing by 1:00. By chance, Abe runs into a client from Denver and they ski together and discuss the client's latest legal matters. As Abe is skiing with this client, Abe and the client both ski through a beginner ski lesson group as the beginner students practice their snowplow technique. Abe and the client each injure one skier. Five law suits are filed: Abe's victim v. Abe; Abe's victim v. the law firm; the client's victim v. the client; the client's victim v. the law firm; and the client's victim v. Abe. Discuss the outcome of each claim, assuming that Abe and the client were solely negligent with respect to their respective victims
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