Every Christmas shopping season there are usually one or two toys that become high demand items. You can always tell the high demand Christmas toy because it disappears from store shelves fast, and then winds up being sold on Internet auction websites for inflated prices. The 2016 Christmas shopping season star was a toy by Spin Master called the Hatchimals. The toy retailed for $50 but was being sold online for as much as $1,000. The problem with the Hatchimals was that when Christmas arrived, they didn’t hatch.
The Hatchimals That Did Not Hatch
The Hatchimals first started being advertised around October 2016. By the time the Christmas shopping season rolled around, the toy became the most popular gift product in the country. Toy industry experts estimate that two million Hatchimals were sold, but Spin Master refuses to confirm any real numbers.
By the morning of December 26, the Spin Master’s Twitter page was exploding with messages from irate parents claiming that a product defect had ruined Christmas. Complaining parents said that the Hatchimals took longer than advertised to hatch, some only hatched partially, and a number of Hatchimals did not hatch at all. Another complaint from parents was that the Hatchimals used up battery power at an accelerated rate and that cost parents a lot of money in extra batteries.
As the Spin Master Twitter feed became overwhelmed, so did its customer service phone lines. Parents complained bitterly about being put on hold for hours and then having the phone system hang up on them. Is there such a thing as corporate liability for ruining Christmas? If there is, then a lot of parents wanted Spin Master to be subject to that liability.
The Reality Of Defective Products
When Spin Master did finally make a public statement, the company vowed to expand its customer service staff and deal with every product issue. The company mentioned that high-tech toys can sometimes be unpredictable and that they suspected some of the issues may have come from parents not properly reading the operational instructions.
Is Spin Master liable for the product defect? When you talk about product liability cases, the vast majority of them center around injuries caused by defective products which can be personal injury lawsuits. In this case, the issue is more with a lack of product performance and has nothing to do with injuries to users. While that does not absolve Spin Master of liability for the product defect, it does narrow down the options that consumers have to getting satisfaction for the Christmas debacle.
As of January 2017, Spin Master was still dedicated to the idea of getting functioning products into the hands of consumers and avoiding a mass recall. However, it should be expected that retail stores will continue to see Hatchimals returned as more parents decide to give up the fight and get their money back. As long as parents stay within the prescribed return period of the retailer they purchased the Hatchimal from, then Spin Master can expect some level of income lost to product returns.
However, if parents wait too long to return their Hatchimals, then there could be an added level of frustration when retail stores stop accepting returns. At that point, it would be up to Spin Master to decide whether or not the company itself will start accepting returns and refunding money. But the public needs to realize that Spin Master is in no way legally obligated to take back products that are kept beyond the pre-determined return window by retailers.
The Next Steps
While parents may want to sue Spin Master for what has happened, the reality is that they cannot as long as Spin Master makes honest efforts to address the problem. Fortunately, parents may be comforted to know that when a company experiences such a negative public relations event as this one during the Christmas season, that the financial damage can be extensive.
At this point, Spin Master now needs to take care of its customers and try to rebuild its young reputation in the toy market. No matter what happens at the end of this crisis, it is safe to say that sales for future Spin Master innovative toys will be much lower, regardless when those toys go on sale.