In the case that opened the chapter, Abbott Industries supplied 1.2 million tubes of bad eye medication to Altana, a customer, for resale. What did the court rule regarding the liability of Abbott Industries?
A) That Abbott industries was liable for the cost of the recall and destruction of the defective medication, for the costs of employee overtime, and for lost future sales because Altana was unable to meet its contractual obligations.
B) That Abbott industries was liable for the cost of the recall and destruction of the defective medication, for the costs of employee overtime, and for lost future sales even though Altana was able to meet its contractual obligations.
C) That Abbott industries was liable for the cost of the recall and destruction of the defective medication and for the costs of employee overtime, but not for lost future sales because Altana was able to meet its contractual obligations.
D) That Altana was only entitled to receive cover, meaning substitution for the defective medication.
E) That Altana was unable to recover anything because business people take a risk that some shipments will be bad.

Question

Quizplus · Accepted Answer

The court ruled that Abbott Industries was liable for the immediate costs associated with the recall and destruction of the defective medication and for the costs of employee overtime needed to manage the situation. However, it did not hold Abbott responsible for lost future sales, as Altana was still able to meet its contractual obligations despite the issue.

In the Case That Opened the Chapter, Abbott Industries Supplied