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defining "fair restitution"

Justice Company A messes up.  Consumer B complains. 
Company A offers Y restitutionConsumer B demands Z restitution.

What happens next?

Should Company A give into Consumer B's demands?  Who is the arbiter of fair?  

Where do we draw the line between fair and satisfactory?

In today's relationship oriented market, where consumer loyalty is increasingly more important, how far should Company A go? 

Pandering to the demands of every consumer is not a sound business strategy.  Customer satisfaction and retention are key to doing business in today's marketplace, but where do we draw the line?

How far can/should a major corporate entity go, to issue not only fair but satisfactory restitution to loyal customers?

Disclaimer: the views represented in this post are entirely my own and do reflect those of my employer.  Photo credit.