I always chuckle a bit when I read that a manufacturer or distributor is “voluntarily” recalling one of its products for safety concerns. From my perspective as a Central and Syracuse New York products liability lawyer, companies never “voluntarily” recall anything. In fact, left to their own devices, most corporations wouldn’t even recall an exploding toy, as long as its sale is turning a profit.
Why not? Because a “corporation” is a legal creature designed for one sole purpose – to maximize profit. Nothing else matters. All that counts is the bottom line. Corporate boards are duty-bound to maximize their shareholder’s dividends and share value, and morality is completely outside, even contrary, to their duty.
So why do manufacturers and distributors of dangerous or defective goods sometimes “voluntarily” recall them? Because they have no choice. They are required to report safety concerns about their products within a short period of time (days) subject to significant sanctions if they don’t. Then, if they don’t recall the product, the Consumer Protection Safety Commission (CPSC), or a similar government safety agency, will start proceedings against them or simply “mandate” the recall. (The CPSC, by the way, is charged with protecting the public from injury or death from unreasonably dangerous consumer products.)