University of Phoenix
Tort Liability and Regulatory Compliance: Alumina v. Bates
How does an organization prevent extensive losses, environmental and commercial, preserve its public image, and abide by pertinent statutes? The question stated is the objective of the fictitious organization, Alumina, found within the week 2 simulation exercise of the University of Phoenix’s Law/531 class. The question stated is relevant for organizations concerned with loss prevention and risk assessment related to tort liability and regulatory compliance.
Regulatory compliance is a challenging task. The challenge is to reduce risk and liability while operating a business. Organizations must mitigate issues related to regulatory compliance and tort liability. Failure to mitigate regulatory compliance and tort liability will result in penalties not limited to fines but lost revenue and diminished ability to compete in the marketplace.
Identifying and managing tort and regulatory risks are critical to sustaining an organization’s operations. “The United States permits greater recovery for torts while requiring less in terms of proof than other nations” (Jennings, 2006, p. 397). Failure to manage torts increases the likelihood of liability that may lead to interruption of business operations. “Tort costs now represent 2.33% of U.S. GDP” (Shanley, 2003, p. 40).
Alumina faced a tort exposure to manage. Kelly Bates alleged proximate cause of her daughter’s leukemia regarding Alumina’s repeated contamination of a local lake. Bates’ allegation references the tort of negligence in the local newspaper, the Erehwon Reporter. Proximate cause is an element of the tort of negligence (Jennings, 2006). Bates cites Alumina’s Environmental Protection Agency (EPA) violation five years ago as grounds for Alumina’s alleged negligence. Bates attempted to acquire the EPA information related to Alumina’s... [continues]
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