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Liebeck v. McDonald’s: Business Analysis

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    The Liebeck case is the famous "coffee" case launched against McDonald's for continuing to serve hot coffee at dangerously high temperatures. This sample paper explores the facts behind the lawsuit and concludes that Liebeck was more than justified in suing the company for its poor business practices. This paper provides an example of business writing services available at Ultius.

    Stella Liebeck v. McDonald’s

    The 1994 case of Stella Liebeck v. McDonald’s fast food chain is one of the most notorious cases of its kind. The case is cited frequently as a sign of lawsuit-happy citizens, and frivolous cases. News reports claimed that Liebeck drove with her cup of McDonald’s coffee between her legs, and spilled the contents of her cup on herself, winning millions of dollars from the company. However, the facts of the case are much different than the popular media portrayed.

    The facts of the case

    Stella Liebeck was 79 years old at the time she spilled the coffee, which was around 185 degrees, according to McDonald’s policy about brewing and holding temperature for their hot coffee (Consumer Attorneys of California).

    Coffee above normal temperature

    Experts say that coffee at McDonald’s policy temperature would cause third-degree burns, which require extensive hospital care and recovery costing more than $10,000, in only a matter of seconds (Rutherford, 73). Reports find that other restaurants serve coffee at a mean temperature of 162.4 degrees and that homebrewed coffee is typically around 135-140 degrees (Rutherford, 64; Consumer Attorneys of California).

    Passenger, not driver

    Liebeck was not driving, either; she was in the passenger seat of her grandson’s car, which was parked in the McDonald’s parking lot while she put cream and sugar into her coffee, but she had a difficult time removing the lid with only one hand, set the cup between her thighs, and spilled the scalding coffee on her thighs and groin (Consumer Attorneys of California).

    More than 700 previous complaints about injuries

    McDonald’s had received at least 700 documented reports of similar injuries due to their coffee, and in each instance had settled out of court; Liebeck’s family asked the corporation for $20,000, just enough to cover her hospital stay of six days and reconstructive surgery, but was denied the settlement (Consumer Attorneys of California).

    No changes in store policies

    Furthermore, following those claims, McDonald’s made clear its intentions of not lowering the temperatures of its coffee, saying that its consumers intended to take the coffee to their destination, that they wanted the coffee that hot, but also that the consumers were unaware that they could suffer 3rd degree burns from their product (Consumer Attorneys of California).

    Damages caused by McDonald's negligence

    Since McDonald's refused to rectify the situation, Liebeck filed for compensation in civil court. Taking into account the willful refusal to lower temperatures, the presiding judge awarded Liebeck with $160,000 in compensatory damages—the jury originally awarded $200,000 but reduced the award because they found Liebeck partially responsible for the spill—and $2.7 million (the equivalent of two days’ worth of coffee sales for McDonald’s) in punitive damages to prevent McDonald’s from repeating their negligent mistake, but the punitive damages were later lowered to $480,000 in accordance with tort laws in Liebeck’s state (Consumer Attorneys of California).

    The issues were focused mostly on McDonald’s willful refusal to adjust the temperature of their coffee, despite knowing it was a dangerous temperature, and having nearly 1,000 reports of similar injuries before Liebeck’s injury in 1992; the presiding judge said that McDonald’s conduct was “reckless, callous, and willful” (Consumer Attorneys of California).

    McDonald’s showed with its actions, including offering Liebeck’s family only $800 after their first request for money to cover hospital bills (Consumer Attorneys of California), that the wellbeing of their consumers was not a priority, which marked them as a target for bad public relations; they retaliated by creating the public image of Stella Liebeck that fueled the debate for tort reform and frivolous lawsuits, which painted her as a selfish woman only out for money.

    Upholding the Court

    The McDonald’s corporation had to make the decision to uphold its interest in its customers since the judge ruled McDonald's is responsible due to it being a corporate personhood. But instead turned its back on Liebeck when she requested assistance paying for bills necessary for repairing the grievous damage to her legs that was a direct result of the corporate policy regarding coffee temperatures, which McDonald’s admitted to having an awareness of. In the time since the case, McDonald’s did not appear to make corporate-wide efforts to better warn its customers about the risks of the hot temperatures, to which Rutherford says:

    “Restaurant operators can insulate themselves from a great deal of litigation by establishing policies that demonstrate knowledge of the risk of hot beverages, and by implementing procedures, training, and supervision to eliminate that risk” (75).

    Rutherford reported a study in which he took part, which found that the majority of the drive-through attendants did not give any real verbal indication to the testers posing as customers, though McDonald’s was:

    “significantly more likely than the other restaurants to provide a written warning” (74).

    It’s arguable that the warnings on the cup alone are not good enough a preventative measure. McDonald’s corporation seems to have learned from their mistakes in some small way, according to the studies, which say:

    “McDonald’s, in particular, seems to be serving coffee at a temperature significantly below that of its peers” (Rutherford, 75).

    Regardless, the temperatures reported in Rutherford’s study could still cause harsh burns within seconds (75). This indicates that McDonald’s only took the minimum amount of action to repair its damaged reputation and care for its future consumers, but lacking any standard regulations means the risk of repeating this case.

    Works Cited

    Consumer Attorneys of California. "Fact Sheet About the McDonalds' Scalding Coffee Case [2011-02-21]." Peter DeFilippis & Associates, P.C.. N.p., n.d. Web. 5 Dec. 2013. http://1917.pd.lawyers.com/Publications/Articles/Fact%20Sheet%20About%20the%20McDonalds%20Coffee%20Burn%20Case.aspx.

    Rutherford, D. G.. "Lessons From Liebeck: QSRs Cool The Coffee." Cornell Hotel and Restaurant Administration Quarterly 39.3 (1998): 72-75. Print.

     
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    Ultius, Inc. "Liebeck v. McDonald’s: Business Analysis." Ultius | Custom Writing and Editing Services. Ultius Blog, 08 Oct. 2014. http://www.ultius.com/ultius-blog/entry/liebeck-v-mcdonald-s-business-analysis.html

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    Ultius, Inc. "Liebeck v. McDonald’s: Business Analysis." Ultius | Custom Writing and Editing Services. October 08, 2014. http://www.ultius.com/ultius-blog/entry/liebeck-v-mcdonald-s-business-analysis.html.

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    Ultius, Inc. "Liebeck v. McDonald’s: Business Analysis." Ultius | Custom Writing and Editing Services. October 08, 2014. http://www.ultius.com/ultius-blog/entry/liebeck-v-mcdonald-s-business-analysis.html.

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