recall
Definition
A recall is when a business pulls a product back from customers or store shelves because it has been found to be unsafe, defective, or in violation of a law or regulation. The government can order a recall, or a company can voluntarily start one to protect customers and limit legal liability. Either way, the business typically has to notify customers, stop selling the product, and offer a repair, replacement, or refund.
Example
A small toy company discovers that the paint on one of its products contains lead, so it issues a recall asking customers to return the toy in exchange for a full refund.
Watch Out
Ignoring a potential safety issue and delaying a recall can expose your business to massive lawsuits and government fines that far outweigh the cost of acting quickly.
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This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.