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Question: Mr. and Mrs. Holowaty, a Canadian couple, stopped at McDonald's for breakfast while traveling through Rochester, Minnesota. Mr. Holowaty purchased a cup of coffee containing the warnings "HOT!" and "CAUTION: CONTENTS HOT" on both the lid and the cup. McDonald's requires its franchises to serve their coffee at between 175 and 185 degrees in containers carrying such warnings. Mrs. Holowaty sat in the passenger seat with the beverage tray on her lap. While exiting the parking lot, the coffee tipped and spilled half its contents on Mrs. Holowaty, causing second-degree burns to her thighs and permanent scars. Mr. and Mrs. Holowaty sued McDonald's as the franchisor, alleging that the coffee was defective because it was excessively hot and because McDonald's failed to provide adequate warnings about the severity of burns that could result. Although the Holowatys admitted that they knew that the coffee would be hot and could cause burns, they argue that reasonable consumers would not anticipate second-degree burns. How should the court rule on their claim?

Management Theories, Management Studies

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