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It's every small business owner's worst nightmare: finding out you've produced and sold a defective product. And from listeria in food to ignition switches on cars and even exploding bottles of marijuana soda, it could happen to any business.
If you've got a defective product on the market or in the hands of consumers, you might need to institute a recall. Here's how to recall a product responsibly and legally:
Your first priority should be your customers' safety. (Also, you may want to avoid a product liability lawsuit.) You should get the product out of any inventory available to customers in order to minimize or avoid further injury. If you can't actually remove every item from stores, you should place some notice on the product that tells customers it has been recalled.
While in most cases instituting a recall won't open a business up for increased legal liability, a business could be subject to punitive damages if it knew a product was defective and didn't act.
And make sure all of your employees are aware of the recall as well. They should know the relevant details of the recall, like the item(s) and the reason, as well as how to communicate with customers about it.
To the extent possible, you should immediately contact each customer who purchased the product. If you have a list of customers you can contact them directly. If not, you can place notices in retail locations. Make sure any possible buyers are aware of the recall and the best ways for them to return the recalled product.
Being up front with your customers, and accommodating them as much as you can will not only avoid further injury but could also avoid an angry clientele -- both of which could lead to lawsuits.
The law surrounding product liability is constantly changing. If you're wondering whether or how to institute a product recall, or you've already been contacted about a defective product, you may want to consult with an experienced small business attorney near you.
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