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Kudler Fine Foods Legal Analysis

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Kudler Fine Foods Legal Analysis Obtaining timely and accurate legal advice is a critical necessity in the modern corporate world and like all industries legal professionals are area specialists. Today’s lawyers may work exclusively with labor issues, negotiations, taxes, contracts, litigation or general corporate law, to mention a few. Retaining one skilled attorney able to navigate the entire scope of Kudler’s needs is unlikely and therefore Kudler will need to retain a corporate law firm to represent all of its interests. According to Kudler Fine Foods (2011) website, Kudler currently uses Anne Shousha, Kathy Kudler’s sister-in-law, as its legal counsel. Anne is reportedly a successful tax attorney employed by an accounting firm in San Diego, California (Legal Overview). Additionally, Kudler’s contact with Anne is screened by Kathy and conducted either by phone, at family events or on the rare occasion in a face-to-face meeting. Historically, Anne has not billed Kudler for the telephonic or casual consultations but does bill at $100.00 per hour for formal meetings. At this time, Kudler’s policy regarding internal legal issues is one in which customer or employee injury’s are reported by the Store Manager to Kathy and she then notifies Anne. Store Managers are free to identify potential legal concerns and suggest them to Kathy but the ultimate decision to elevate to Anne rests with Kathy. According to Kudler Fine Foods (2011) website, Kudler “has had only a few customer accidents that have ended in litigation. In each case, Anne suggested that Kathy agree to a settlement” (Legal Overview). Kudler Fine Foods has not written its own legal forms and normally relies on suppliers or partners to provide the legal documentation of transactions and obligations. On the rare occasion that a form or contract is not available as previously mentioned, Kudler has obtained an off-the-shelf computer forms program and made slight modifications to meet their needs. As Kudler has grown, so too have the legal and regulatory concerns of the business. Kudler’s growth was built on the close specialized relationship with its customers and employees and previously avoided the formalities of a strict retailer-employee-customer association found in large retail organizations. Kudler Fine Foods has taken the course that hundreds of other businesses have taken when opening and making needed legal arrangements. Kudler has relied on a personal/familial relationship to provide the legal direction needed so far. Fortunately, Kudler has not faced any serious legal challenges but in this day of corporate growth and wild litigation by customers and employees Kudler must retain professional legal counsel that can review Kudler’s entire operation with a special focus on issues of product liability. Concerns of product liability in the retail food industry are increasingly complex and require retailers to take an active role in ensuring their own goods as well as those of their suppliers are compliant with a multitude of regulations, social issues health concerns. Further, retailers must have in place processes that allow them to react safely and quickly in a recall situation to avoid excessive financial impacts and damages to reputation. Balancing the concerns of corporate responsibility and ethics while providing the latest trends in gourmet dining is a requirement Kudler must conscientiously develop and maintain. According to several websites the generally accepted legal definition of “product liability” is ‘the responsibility of manufacturers, distributors, suppliers and sellers of products to the public, to deliver products free of defects that harm someone and to make good on that responsibility if the products are defective’ [1], [2], [3]. Based on this definition, Kudler, the retailer of consumer products, is responsible for the delivery of its products to the consumer free of harmful defects. Further, if a product is found to be defective, Kudler is liable for compensating the offended consumer(s). Yet this definition does not fully explain the extent to which a retailer, Kudler in our case, is responsible for its products. In addition to the compensation associated with legal action by a consumer or group of consumers, Kudler may also bear the expense associated with traceability, recall, regulatory compliance, and damage to their image as a high quality gourmet food retailer. In recent years concerns over food safety have given rise to a plethora of new regulations at the local, state and, federal levels designed to provide greater protections for consumers. Outbreaks of salmonella, listeria and other food borne pathogens have repeatedly become headline news and many retailers have been caught up in the frenzy that has followed. In most of these cases the retailers as well as the producer(s) are held liable for personal injury claims frequently amounting to millions of dollars. Recent cases of food borne illness suits weaving there way through the courts include tainted cantaloupe, eggs, spinach, lettuce, beef and, peanut butter [4], [5], [6], [7], [8], [9]. These cases affect not only the consumer but also both growers and often retailers themselves. Kudler’s procurement program is loosely based on traditional purchasing protocols of acquisition of products by Kathy and her store managers. Unfortunately, these practices are not done with any conscience consideration of the potential legal liability Kudler may face, or the safety of its customers. To mitigate the potential catastrophe of a product liability lawsuit or regulatory action, either of which could cripple Kudler, a company-wide procurement program based on industry accepted standards is required. This protocol must provide the training to purchasing agents and tools ensure that, Kudler only procures the highest quality goods and produce for its customers. Anything short of this exposes Kudler and its customers to potentially lethal consequences. In addition to the adoption of purchasing standards, Kudler must also put into place a system to screen potential suppliers, transportation companies and growers to document compliance with regulatory requirements and Kudler’s own purchasing expectations. Liability concerns are not just Kudler’s but also those of its providers and suppliers. Being able to document any link in the grower to consumer chain allows Kudler the flexibility to quickly and effectively track potentially contaminated products and, if necessary, recall the product and avoid the impact to the public. Traceability has been the recent focus of both state and federal regulators in an effort to not only establish best practices principles in the agriculture and retail industries but also to establish viable and workable traceability standards. Currently many countries, states and associations are developing guidelines for traceability of consumer food products. According to California State University’s Center for Agriculture Business, (2008) industry traceability systems have “provided information necessary to begin to isolate the source of contamination” (Paggi, 2008). Embracing and adhering to the suggested guidelines presented in this study will allow Kudler to improve the entire procurement process and install a much needed food protection systems into the entire organization. As Kudler continues to grow, it should add an IT based regulatory or compliance database capable of tracking food related regulations, specific food borne contaminants information, agriculture growing guidelines and, Kudler producer requirements. Kudler will be able to provide access to best practices for growers through simple online link, assign and track supplier’s shipments and confirm grower’s adherence to Kudler product standards. Finally, Kudler Fine Foods should identify and retain a law firm that can represent Kudler in both labor and liability cases. Kathy’s relationship with Anne Shousha may be particularly useful in locating and selecting this firm as she has frequent contacts with members of the California Bar Association. Kudler, as noted, is at a defining moment in its growth and it must make substantial changes to its culture and structure to protect against loss and liability. Notes
[1] Internet Brands. (2012). NOLO Law for All. Retrieved from http://www.nolo.com/dictionary/product-liability-term.html
[2] Farlex, Inc.. (2012). The Free Dictionary. Retrieved from http://legal-dictionary.thefreedictionary.com/product+liability
[3] Wikimedia Foundation, Inc.. (2012). Wikimedia The Free Encyclopedia. Retrieved from http://en.wikipedia.org/wiki/Product_liability
[4] The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2011/0930/Listeria-outbreak-Victims-file-lawsuits-but-will-they-receive-damages
[5] The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Eggs
[6] The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Peanut-butter
[7] The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Spinach
[8] The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Lettuce
[9] The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Beef

References Farlex, Inc.. (2012). The Free Dictionary. Retrieved from http:// http://legal-dictionary.thefreedictionary.com/product+liability
Internet Brands. (2012). NOLO Law for All. Retrieved from http://www.nolo.com/dictionary/product-liability-term.html
Paggi, M. S. (2008). Traceability for Food Marketing and Safety. Retrieved from http://cab.cati.csufresno.edu/PDF/Traceability%20Report%20-%20M%20Paggi.pdf
The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2011/0930/Listeria-outbreak-Victims-file-lawsuits-but-will-they-receive-damages
The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Eggs
The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Peanut-butter
The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Spinach
The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Lettuce
The Christian Science Monitor. (2012). Listeria outbreak: Victims file lawsuits, but will they receive damages?. Retrieved from http://www.csmonitor.com/USA/2010/1130/Food-Safety-Act-five-food-recalls-that-rattled-the-industry/Beef
Wikimedia Foundation, Inc.. (2012). Wikimedia The Free Encyclopedia. Retrieved from http:// http://en.wikipedia.org/wiki/Product_liability

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