[1] Ya-brand Milk Powder Quality Damage Compensation Case
In July 2004, Guangdong Zhiming Law FirmLawyersThe team took on a consumer rights case seeking compensation from the international brand Yashmilk formula: Zhang Mouhui's son, who was less than six months old, developed severe fever, diarrhea, and other symptoms after being fed Yashmilk Ximouli formula. Testing by the Shenzhen Center for Disease Control and Prevention confirmed that the formula contained Staphylococcus aureus bacteria, indicating serious quality problems!
Upon accepting the engagement, our lawyer conducted thorough verification, investigation, and gained a comprehensive understanding of the background of Ya Mou Pharmaceutical Co., Ltd., as well as the market share held by its Ya Mou Xi Mou Li infant formula in the Chinese mainland sales market at that time. With careful deliberation, meticulous consideration, and cautious wording, a lawyer's letter rich in substance and significant weight was drafted and sent to the relevant entities of Swiss Ya Mou Pharmaceutical Co., Ltd.
This lawyer's letter effectively deterred Ya Mou Pharmaceutical Co., Ltd. and its affiliated parties. As a result, a positive response from Ya Mou's side was quickly obtained. After several rounds of correspondence and telephone communications between both parties, a settlement agreement was ultimately reached privately: the U.S. Ya Mou Pharmaceutical Co., Ltd. instructed its Chinese agent—Nanjing Mou Mou Mou Mou Trading Co., Ltd.—to voluntarily compensate our client Zhang Mouhui for various losses incurred during his son's illness caused by the toxic bacteria-contaminated Xi Mou Li infant formula, including medical treatment, transportation, lost wages, and mental distress, totaling RMB 11,000 yuan.
Thus, a civil damages dispute that had gone through several mediation agencies with no resolution, and a long-standing consumer rights conflict, was easily settled. Both parties were spared the burden of protracted and tedious litigation, and Zhang Mouhui's family in particular avoided immense mental anguish and material loss!
Art of Representation:
As the saying goes, trees need bark, and people need face. Whether in business, officialdom, or personal conduct, everyone wants a good reputation and a favorable name, and no one wishes to bear a bad reputation, be cursed, or be pointed at. Companies selling products, in particular, rely heavily on a good reputation and a positive name in the market.
In this case, as the attorney representing the victim, we keenly learned and understood that the quality of Yakang milk powder produced by Yakang Pharmaceutical Co., Ltd. in the United States, a subsidiary of Swiss Yakang Pharmaceutical Co., Ltd., had already been the subject of numerous negative reports and unfavorable information in newspapers and online media during the year the victim, Zhang Mouhui's son, was harmed, as well as in prior years. In response, Yakang had undertaken extensive "damage control" efforts. The negative impact on society and the market was gradually fading, and the image of high-quality milk powder and its market reputation were also being progressively restored.
At this moment, the Ya family is like a patient who has just recovered from an illness and is still frail and vulnerable—unable and unwilling to endure further hardship. Any controversy over the quality of their newly launched milk powder is bound to inflict even greater economic losses on the company. Like a camel seemingly unable to bear the weight of the final straw, they especially need a period to completely dispel the unfavorable rumors in the market and recuperate. Therefore, they are extremely fearful of any negative reports about product quality resurfacing in public opinion.
Therefore, based on the conclusive evidence from a legally authorized testing institution that the Yakang Xili milk powder contained harmful Staphylococcus aureus, I employed artistic dispute-resolution tactics and psychological pressure to exert extra-legal leverage on the Yakang side, combining reasoned persuasion with emotional appeal. Rather than opting for direct litigation, I chose to engage through the issuance of a lawyer's letter for negotiation.
In this "Ya Mou Milk Powder Compensation Case," as the attorney representing the client, we appropriately selected and applied the strategy of "beat the grass to startle the snake" from the Thirty-Six Stratagems.
At the outset of representing the "Zhang Mouhui and Ya Mou Milk Powder Rights Protection Case," after careful analysis, we concluded that:
As an internationally renowned brand, Ya Mou milk powder products are sold across the global market, particularly in mainland China, where their market share is exceptionally prominent and the brand's reputation is highly favorable.
If the client, Zhang Mouhui, were to expose to several influential domestic media outlets, criticizing the quality flaws in their milk powder, it would severely damage the brand reputation they have worked so hard to build over a long period, inevitably leading to a significant decline in their competitiveness in the mainland China market and causing them substantial economic losses.
Therefore, we used this as our "point of attack" to remind and warn Yamei Milk Powder that they have this weakness and vulnerability, and that they cannot continue to ignore our client Zhang Mouhui's compensation demands. Otherwise, our client Zhang Mouhui would be forced to expose to the public through various media and online platforms the fact that his son developed a fever and diarrhea after being fed Yamei Ximouli formula, in order to provoke public condemnation of unethical international corporations and rally support for the victim.
Our lawyer's reminders and warnings greatly unsettled Ya Mou Milk Powder, causing them to hesitate. They dared neither to continue stalling and ignoring the matter, nor to face us in court and fight it out legally, fearing that public opinion's impact on consumers would lead to even greater financial losses. In the end, they had no choice but to reluctantly and helplessly seek a private settlement. This is yet another classic case where a subtle maneuver—"beating the grass to startle the snake"—achieved a resounding success.
This legal letter is carefully worded and precisely expressed, with emphasis on the following: As a major international corporation, Yamei Pharmaceutical Co., Ltd., and Yamei infant formula as an internationally recognized brand in milk powder production and marketing, the loss of its commercial reputation far outweighs the minimal compensation required to resolve this dispute. It is hoped that Yamei will recognize the gravity of the situation and make a wise choice. Otherwise, as the attorney entrusted by the victim's father, Mr. Zhang Mouhui, we will not only initiate rights-protection litigation against Swiss Yamei Pharmaceutical Co., Ltd. and its affiliated entities in accordance with the law, but will also expose to various Chinese media outlets the evidence of the poor quality of Yamei infant formula and its contamination with Staphylococcus aureus bacteria. Should this occur, the damage to the Yamei brand image will be severe, and the market sales of Yamei infant formula will inevitably be greatly affected. In such a scenario, the economic losses suffered by Yamei will far exceed the amount of compensation payable in this dispute.
Our lawyer's psychological deterrence and analysis of the stakes indeed moved and persuaded Ya's side. Through the coordination conveyed by Ya's attorney, Ya's side ultimately made the wise choice to sacrifice the smaller for the greater, and readily gave full satisfaction to the excessive claims and settlement conditions proposed by our client, Zhang Mouhui, which exceeded legal standards and scope.
And so, a long-standing, drawn-out dispute between consumer and merchant was swiftly and thoroughly resolved through our artistic negotiation tactics.
Lessons from the case:
For this case, if handled using conventional litigation methods:
Given the shopping receipts showing that Zhang Mouhui's family purchased Yakult Xili infant formula, the statutory test report confirming the presence of Staphylococcus aureus toxin in the formula, and the solid evidence that the infant fell ill and required treatment after consuming it, it is more than sufficient to prove that the quality of Yakult Xili infant formula is defective. Moreover, considering that the victim consumer's representative, Zhang Mouhui, had already engaged in over six months of repeated negotiations and coordination with the merchant through several organizations, including the Shenzhen Consumers' Commission, without any resolution of the issue, most lawyers would naturally choose to proceed directly with litigation in accordance with the law. To be honest, this is a logical, routine, and reasonable course of action. For the majority of lawyers, handling the matter in this way is entirely justifiable and not a significant error.
However, if this consumer rights dispute were to proceed through a routine lawsuit with conventional thinking, the child's illness of fever and diarrhea after being fed substandard formula milk would hardly qualify as particularly critical or difficult to treat. It is a minor viral infection, and even if compensation were awarded, it would only be calculated according to the statutory standards and scope!
Therefore, at most, a judge's ruling according to law could only award compensation for the loss of the milk powder purchase of a little over 100 yuan, medical expenses of a little over 200 yuan, plus appropriate transportation costs and losses from time spent on rights protection, all of which combined would at most not exceed one to two thousand yuan. For such a minor ailment, it is simply impossible to obtain compensation for mental harm or psychological suffering that goes beyond the statutory scope and is difficult to define in terms of the degree of damage!
In other words, if this consumer rights dispute case were to be adjudicated through court proceedings, the victim Zhang Mouhui would under no circumstances be able to obtain economic compensation exceeding 10,000 yuan.
Moreover, in general cases, a consumer rights claim lawsuit filed through conventional litigation procedures, from filing to trial and judgment, if both the first-instance and second-instance statutory procedures are fully completed, will inevitably take a long time. Regardless of the outcome, the litigation process alone would take at least a year or more. During this period, the consumer victim Zhang Mouhui and his family, as the plaintiffs, would inevitably expend both time and energy, undoubtedly adding more mental suffering, emotional torment, and the immense adverse consequence of failing to obtain satisfactory compensation for material losses afterward. A comparison of the two makes it crystal clear, fully demonstrating the wonder and brilliance of my artistic dispute resolution technique.
However, after gaining an understanding of the market performance of Ya's milk powder and identifying the operational weaknesses of Ya Pharmaceutical Co., Ltd., we used a lawyer's letter to provoke a reaction, targeting their psychological vulnerabilities. This prompted them to proactively respond to our client's compensation claims and engage sincerely in negotiations over settlement terms and the amount of compensation. As a result, we not only spared Ya from the substantial business losses that could have arisen from further reputational damage caused by litigation, but also saved our client, Zhang Mouhui, from the prolonged burden, hassle, and greater emotional distress of a lengthy legal battle, as well as the loss of pursuing compensation targets that legally could not have been met. This avoided the unwise outcome of "winning the battle but losing the war"!
By employing a few strategic maneuvers, we skillfully pressured the seemingly dominant merchant into a settlement, leading them to voluntarily compensate our client, Mr. Zhang Mouhui, 11,000 yuan for the harm caused to his child by bacterial contamination. This amount exceeded the statutory standard and scope of economic damages, not only directly recovering all material losses incurred by Zhang's family from purchasing the milk powder and the child's illness, but also compensating and comforting the mental anguish suffered by Zhang's entire family due to the infant's hospitalization for viral infection.
As the old saying goes, "Harmony brings wealth." Most businesses follow this ancient wisdom and are reluctant to go to court against wronged consumers. If spending a little money can avoid huge economic losses, why not do it? Therefore, although this case may not seem particularly significant in its facts, its significance as a reference for resolving disputes easily and efficiently outside the courtroom through unique strategic tactics should not be underestimated! The artistic technique of "beating the grass to startle the snake" — where the weaker party outmaneuvers the stronger through wit and clever strategy in a contest of wits — is truly the superior approach. When applied appropriately, its effectiveness is exceptional.
Attachment: Relevant materials for the Yamo Milk Powder Mediation Case
