Case Evaluation

Defective Product Verdicts: American Foods Co. v. Belmark

AMERICAN FOODS COMPANY V. BELMARK

Date: September 16, 2004

RESULT: $ 4,900,000 (verdict)

STATE: Michigan

FACTS: A Macomb County jury awarded $ 4,900,000 in damages to a manufacturer of beef jerky and beef snacks. The verdict was the result of a products liability case in which the plaintiff claimed that the packaging it received from a Wisconsin company was defective, resulting in substantial business losses.

Plaintiff American Foods Company manufactured beef jerky and beef snacks, which it packaged and sold to distributors and stores. Plaintiff bought its packaging from Defendant Belmark, a Wisconsin packaging supplier. Plaintiff alleged that several hundred thousand packages obtained from defendant failed. As a result, plaintiff claimed to have sustained severe business losses.

Plaintiff alleged that internal documents showed several hundred thousand defective packages were supplied by defendant. According to plaintiff, the packages were "de-laminated," which caused the meat to become dry and moldy. Plaintiff also claimed that some of the packaging dyes caused the meat to appear green. Plaintiff further alleged that defendant's promise of a two week delivery of its product was delayed by two to three months. Plaintiff claimed $ 13,800,000 in business losses as a result of the Defective Product and contractual delivery problems.

Defendant contended that plaintiff approved the sample defendant sent showing the packaging print and opacity. Accordingly, defendant argued that there could be no breach of warranty as a matter of law. Defendant also asserted that plaintiff failed to mitigate its damages and reasonably seek cover for its losses and that there was no evidence beyond mere speculation demonstrating that any decline in sales plaintiff experienced was related to the Belmark packaging.

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