Heck, I played with lead, mercury, solder and various glues that had really bad fumes that gave me headaches... I probably would have been better off with all the brain cells God intended for me...
How much stress did it take to make the parts fall off. If the kid had to beat the crap out of the toy to get it to fail, then I don't think the manufacturer should be held responsible, If the parts just dropped off, then that's another story. In my mind anyway it boils down to reasonable expectations.