In which case, your grandpa gets his money back, plus filing costs, plus serving costs, and if it's a default judgement, no one to argue against the gas costs, and time costs you tack on.
Please show me how this is suboptimal? Especially with LLMs to write the demand letter, and walk you through the process.
And 'using their in house lawyer' still has time cost, as does dealing with the routing and pondering the service letter. And accounting paying up. There is no aspect of your 'worst case' where it's bad. It's still all pluses. And if as I suggest, lots and lots of people do it, then they end up with a loss on that product.
If each case is $1000, or even $500 payout, how much profit does that take? Profit on 100 units? 50? If a product is horrifically bad, and everyone runs to small claims court, that's disaster for a company.